What did the U.S. Treasury say about the South Korean won?

The U.S. Treasury stated that the recent depreciation of the South Korean won was not in line with the country's strong economic fundamentals.

Why did the South Korean won depreciate in late 2025?

The won faced depreciation pressures in late 2025 due to the central bank reducing its policy rate and the onset of domestic political instability.

Is South Korea accused of currency manipulation by the U.S.?

No, South Korea was not accused of currency manipulation but remains on the U.S. Treasury's monitoring list for currency practices.

Home / Business and Economy / Won's Depreciation Outpaces Korea's Strong Economy

Won's Depreciation Outpaces Korea's Strong Economy

31 Jan

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Summary

U.S. Treasury stated South Korean won depreciation was inconsistent with economic fundamentals.
Won faced acute pressure in late 2025 due to domestic political instability.
South Korea remains on the U.S. Treasury's monitoring list for currency practices.

Won's Depreciation Outpaces Korea's Strong Economy

The U.S. Treasury has issued a notable assessment regarding the South Korean won, indicating that its recent depreciation does not reflect the country's robust economic fundamentals. This observation was part of the Treasury's semi-annual currency report, released on Thursday, January 30, 2026.

Depreciation pressures on the won were particularly acute during the fourth quarter of 2025. This period saw the South Korean central bank reduce its policy rate in November 2025 and was marked by the onset of domestic political instability. The currency weakened further in late 2025, a trend the U.S. Treasury found inconsistent with Korea's strong economic standing.

This rare U.S. commentary on the dollar-won exchange rate followed intervention by South Korean authorities in December 2025. They implemented measures to support the won as it approached the significant psychological threshold of 1,500 per dollar. Investor concerns, including overseas stock purchases and potential U.S. investment agreements, also contributed to the pressure.