The South Korean currency is gaining strength in light of the recovery in exports

Data from the South Korean Central Bank showed, on Sunday, that the South Korean currency, the won, gained strength against the dollar in light of the increase in the supply of the dollar due to the recovery in exports.

The South Korean Yonhap News Agency reported that the won currency recorded an average of 1,342.6 won against the dollar during the first 12 trading sessions this October, which is the lowest level since September 2024, when the average exchange rate of the won against the dollar reached 1,332.8 won, according to data from the Economic Statistics System of the Central Bank of Korea.

The average monthly exchange rate rose to 1,492.5 won last March following the outbreak of war in the Middle East, and recorded 1,528 won last June in light of the rise in crude oil prices.

The South Korean currency has gained strength since then, with exporters selling dollars in the market, with the average monthly exchange rate falling to 1,488.9 won last July, 1,404.4 won last August, and 1,358.8 won last September.

Experts said that South Korea's trade surplus and the abundance of the dollar currency supported the rise in the value of the won.

The International Monetary Fund had raised its forecast for South Korea's economic growth to 3.3 percent in 2026, attributing this to strong semiconductor exports that mitigated the impact of the war in the Middle East.

Interest rate

The results of a poll on Sunday showed that economists expect the South Korean Central Bank to keep interest rates unchanged during its next meeting scheduled for later this week.

A survey of six economists, conducted by the South Korean Yonhap Agency, concluded that all economists expected the bank’s monetary policy council to keep the interest rate at 3 percent during the meeting scheduled for next Thursday.

Economists said the central bank needed time to assess market conditions after raising interest rates twice in a row last July and August.

“Raising the interest rate three times in a row could represent a huge burden on local families and companies,” said Joo Won, a researcher at the Hyundai Research Institute.

He added: “It is highly likely that the central bank will stop raising interest rates this time to evaluate the repercussions of raising interest rates previously.”

It is noteworthy that during a parliamentary scrutiny session last week, Central Bank Governor Shin Hyun-sung indicated a possible pause in raising the interest rate, and said: “When we set monetary policy, we always evaluate the amount of time that economic officials need to evaluate their ability to do so.”