Korean won hits a more than 17-year low versus the dollar, weakest since March 2009

The South Korean won fell to a more than 17-year low against the U.S. dollar on June 4, 2026, reaching 1,532.57 per dollar, its weakest level since March 2009. The decline reflects broader pressures on Asian currencies amid ongoing geopolitical tensions in the Middle East, particularly the conflict involving Iran, which has driven up oil prices and prompted capital reallocation. Brent crude prices climbed toward $98 per barrel, raising concerns over potential supply disruptions in the Gulf and increasing South Korea’s import costs, given its heavy reliance on energy imports.

The won’s depreciation has been exacerbated by sustained foreign equity outflows, with investors net selling approximately 2.5 trillion won worth of local shares. Additionally, a sharp rally in domestic stocks has prompted foreign investors to rebalance their portfolios, further weighing on the currency. Despite government assurances to curb excessive volatility, the won has lost over 6% of its value this year.

Meanwhile, South Korea’s economy showed mixed signals. Inflation surged to its highest level in over two years in May, while exports grew to a record $87.75 billion, driven by strong global demand for semiconductors amid the AI investment boom. Finance Minister Koo Yun-cheol emphasized that authorities are closely monitoring foreign exchange markets and are prepared to take “prompt, necessary measures” to stabilize the currency.

Analysts expect the won to trade at 1,503.53 by the end of the quarter and 1,462.10 in 12 months, according to Trading Economics forecasts. The currency’s performance underscores the complex interplay between global geopolitical risks, capital flows, and domestic economic fundamentals.