#Foreign Exchange

U.S. Treasury Secretary Scott Bessent told S. Korean Finance Minister Koo Yun-cheol that the won's recent depreciation is out of sync with strong economic fundamentals.

South Korea's foreign reserves fell by $2.6 billion in December 2025 to $428.05 billion, marking the first decline in seven months due to currency stabilization.

South Korea's Customs Service has launched a special investigation into a record $278.7 billion discrepancy between trade payments and customs data, the largest in five years, suspecting illegal exploitation of forex markets.

Major investment banks have lifted South Korea's 2026 inflation forecast to 2.0%, citing the persistently weak won. With the currency nearing 1,500 per dollar, import costs are rising, posing a dilemma for the Bank of Korea.

A South Korean official stated the country's 2026 investment in the U.S. will likely be 'much smaller' than the $20 billion cap, a move to calm markets as the won hits a 16-year low.

South Korea's finance ministry has signaled decisive intervention to support the falling won. The move comes as investors shift funds abroad, raising concerns about market stability.