Recent forecasts for the USD to KRW exchange rate indicate a delicate balance of factors affecting both currencies. Analysts note that the US dollar (USD) has strengthened significantly, buoyed by recent hawkish remarks from Federal Reserve Chair Jerome Powell, which dampened expectations for a December rate cut. This sentiment has been further supported by positive indicators from the ISM manufacturing PMI, which could bolster the USD if sustained growth is reported in the manufacturing sector.
On the South Korean side, multiple factors challenge the Korean won (KRW). The Bank of Korea's foreign exchange intervention, with a reported net sale of $800 million in the second quarter of 2025, reflects ongoing efforts to stabilize the currency amidst external pressures. Trade negotiations with the U.S. have stalled, raising concerns about potential downward pressure on the KRW. Furthermore, the Bank of Korea's anticipated revision of the economic growth forecast could lead to further depreciation, with predictions suggesting the KRW/USD rate might reach 1,430 in the coming months.
Experts highlight that recent USD to KRW levels around 1430 represent a notable 1.9% increase over the three-month average of 1404, indicating a period of volatility within a relatively stable range of 1379 to 1439. The ongoing global shift away from the USD as a reserve currency, coupled with unresolved U.S.-China trade tensions, adds another layer of complexity to the outlook for both currencies.
Overall, while bullish trends in the USD are shaped by domestic economic signals, the KRW faces headwinds from both local economic forecasts and external trade dynamics, resulting in a cautious outlook for those engaged in international transactions.
