FX.co ★ South Korean Won Extends Losses on Dollar Strength

The South Korean won depreciated to approximately 1,412 against the US dollar on Tuesday, marking its fourth consecutive session of losses and nearing a five-month low. This decline came amid the US dollar's resurgence, driven by halted funding negotiations in the US and ongoing global uncertainty. The dollar's strength was further bolstered by the failure of rival budget proposals to progress in the Senate, extending the US government shutdown beyond a week. Investors are now anticipating insights from Federal Reserve officials set to speak later in the week, hoping for additional policy direction. Concurrently, regional currency weakness, notably the yen, exerted further downward pressure on the won amidst heightened demand for the dollar, as expectations of continued fiscal stimulus emerged following Japan’s leadership transition. Meanwhile, trading activity in South Korea was subdued due to a local holiday closure of financial markets.