South Korean Won Strengthens to Two-Month High on Strong Q2 GDP, Exports
Quick Look
- The South Korean won reached a two-month high against the U.S. dollar and a 20-month low against the Japanese yen, driven by better-than-expected Q2 GDP growth of 0.6% and strong semiconductor exports.
- Overseas investors bought 2.1 trillion won in local stocks, pushing the KOSPI up 4.4%.
AI-generated summary
Why It Matters
South Korea's economy reported better-than-expected 0.6% growth in the second quarter, driven by firmer exports of semiconductors, leading to a significant strengthening of the won against major currencies.
SEOUL, July 23 (Yonhap) -- The South Korean won strengthened to a more than two-month high against the U.S. dollar Thursday, as the nation's economy reported better-than-expected growth in the second quarter on firmer exports of semiconductors.
The won was quoted at 1,466.8 won per dollar at 3:30 p.m., up 13.3 won from the previous day.
The won started the day at 1,478 won per dollar and rose to as high as 1,457.9 won, marking the strongest level since May 8.
The country's real gross domestic product rose 0.6 percent in the April-June period from three months earlier, according to the Bank of Korea, exceeding the central bank's May forecast of 0.2 percent growth.
With the Japanese yen tumbling to its lowest level against the dollar in about 40 years, the won-yen arbitrated exchange rate hovers below 900 won per 100 yen.
It was the first time in about 20 months that the won-yen exchange rate fell below the 900 level.
The U.S. dollar serves as the benchmark currency for the exchange rate between the two.
Overseas investors bought a net 2.1 trillion won (US$1.4 billion) worth of local stocks on Thursday, with the benchmark Korea Composite Stock Price Index jumping 4.4 percent to close at 7,096.89 points.
Open Questions
- Will the won's strength continue in the coming months?
- How will the Japanese yen's weakness impact South Korean trade competitiveness?
