US Treasury says recent Korean won weakness not aligned to fundamentals

By Cynthia Kim

SEOUL, Jan ⁠30 (Reuters) - The ⁠U.S. ‍Treasury said recent depreciation in the South Korean won was not in line with the Asian ‍country's strong economic fundamentals, in an assessment that ​was part of a semi-annual currency report.

"Depreciation pressures on the won were ​acute in the fourth quarter of 2024 as the central bank reduced its policy rate in November and amid the onset of domestic ​political instability," said the report released on Thursday. "The won depreciated further in late 2025, which was not in ​line with Korea’s strong economic fundamentals."

The rare U.S. assessment on the dollar-won level ‌came after South Korean authorities in December rolled out measures to bolster the currency as it ​slumped towards the psychologically important level ⁠of 1,500 per dollar.

The currency has been under pressure from domestic investors' purchase of overseas ‌stocks and concerns about additional U.S. investment, which was part of a trade deal with President Donald Trump's administration.

The won closed ‌at 1,434.0 per dollar on Thursday, bouncing in recent days after ‌a joint response between Japan and the U.S. helped strengthen the yen.

In its latest semi-annual currency report, the Treasury said no major trading ‍partner met all three criteria for enhanced analysis of currency practices during the last half ⁠of 2024 and the first six months of 2025. South Korea remained on a "monitoring list" meriting close attention, but was not accused of currency manipulation.

(Reporting by Cynthia Kim; Editing by Chris Reese and Jamie Freed)

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