South Korea's Won Anchors Near 1,400 per Dollar as Geopolitical Risk Clashes with Semiconductor Export Strength

According to E Daily analyst Lee Jin-kyung at Shinhan Investment, South Korea's USD/KRW exchange rate oscillated between 1,400 and 1,500 won last week, with the currency weakening in early week amid dollar strength and Middle East tensions, then stabilizing below 1,500 won as downward pressure eased. Foreign investors' net stock purchases, offshore dollar selling, and anticipated dollar supply from SK Hynix's U.S. ADR listing supported won strength.

This week, Middle East escalation remains the primary upside variable for the exchange rate; expanded U.S.-Iran clashes or attacks on oil infrastructure could push the rate back above 1,500 won. Conversely, improved bilateral negotiations may gradually weaken geopolitical premium. Domestically, Q2 GDP growth, semiconductor export momentum, and Korea's central bank rate-hike expectations should cap won weakness, with the rate expected to trade in the late 1,400s throughout the week.