Korean won falls to 4th-lowest monthly level amid foreign outflows

▲ This Reuters file photo shows birds flying near a boat in the Strait of Hormuz amid the U.S.-Israeli conflict with Iran, as seen from Musandam, Oman, on March 2, 2026. (Yonhap)

S Korea-currency volatility

Korean won falls to 4th-lowest monthly level amid foreign outflows

SEOUL, March 29 (Yonhap) -- The South Korean currency has fallen sharply to its fourth-lowest level against the U.S. dollar in March amid a foreign selloff on the stock market, financial data showed Sunday.

The won averaged 1,489.3 won per dollar through the first 27 days of March based on the daily won-dollar rate quoted at 3:30 p.m., according to data from the Bank of Korea and Yonhap Infomax.

It marked the fourth-lowest monthly average on record, following 1,499.38 won in December 1997, 1,701.53 won in January 1998 and 1,626.75 won in December 1998, in the aftermath of the Asian financial crisis in 1997.

On a weekly basis, the average won-dollar rate was 1,503.4 won for last week, breaching the 1,500 won threshold for the first time in 17 years, since the second week of March 2009.

By percentage, the won fell 4.72 percent against the U.S. dollar in the first 28 days of March, marking the steepest monthly decline among major currencies.

The U.S. Dollar Index, a widely used measure of the U.S. dollar's strength against a basket of six leading currencies, including the euro and Japanese yen, rose 2.6 percent over the same period.

The euro fell 2.62 percent against the U.S. dollar, and the yen dropped 2.58 percent, while the Chinese yuan declined 0.84 percent, and the Taiwan dollar slipped 2.11 percent.

The sharp decline in the Korean won was mainly driven by large-scale selling by foreign investors amid prolonged Middle East tensions and concerns over the outlook for artificial intelligence (AI) technology.

Foreigners sold a net 29.8 trillion won (US$19.7 billion) worth of Korean stocks on the main Korea Composite Stock Price Index (KOSPI) in March, following a net 21.1 trillion-won selloff in February.

Analysts expect the Korean won to hover around the 1,500 won level against the U.S. dollar even after the Middle East conflict subsides.

"It will take years for damaged energy facilities in Gulf states to return to normal, and the normalization of the Strait of Hormuz is also likely to be delayed," said Baek Seok-hyun, an economist at Shinhan Bank. "The exchange rate is highly likely to remain in the 1,500 won range."

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