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Won's Dip Temporary? Chip Sector to Fuel Recovery
18 Sep
Summary
- South Korea's chip sector is expected to support the won's recovery.
- A Citigroup trader predicts the won could strengthen by year-end.
- External factors might cause the won to briefly weaken past 1,400 per dollar.
The South Korean won may see a short-lived period of weakness. External factors could push the currency past 1,400 won against the dollar in the immediate future. However, a more optimistic outlook suggests a recovery by the close of 2026.
This projected rebound is largely attributed to the resilience and growth of South Korea's critical semiconductor sector. A trader from Citigroup Inc. highlighted the importance of this industry in supporting the won's value.
Despite potential near-term volatility, the underlying strength in the chip industry is expected to provide a solid foundation for the won's appreciation. This positions the currency for a comeback in the latter part of the year.
