The South Korean won extended its decline to 0.7% against the U.S. dollar on Tuesday, erasing earlier gains as foreign investors turned cautious amid mixed signals about the Federal Reserve’s rate-cut timeline. The currency’s weakness coincided with the benchmark KOSPI index surrendering its intraday advances, finishing flat after swinging between gains and losses during the session.
Market analysts attributed the won’s underperformance to renewed dollar strength across Asian markets and position adjustments ahead of key U.S. inflation data. The simultaneous retreat in equities suggests growing risk aversion among international traders, who have been net sellers of Korean stocks for three consecutive sessions despite attractive valuations in the tech sector.
The won’s drop marks its steepest single-day fall in two weeks, with the USD/KRW pair testing resistance levels last seen in early June. Traders are now closely watching the 1,380 won per dollar level, a breach of which could trigger further technical selling and potentially prompt intervention warnings from Korean monetary authorities.
Related topics：
