South Korea’s won outperforms peers as AI-driven chip demand and coordinated FX intervention lift the currency against the USD.
The South Korean won is the top-performing Asian currency this week, driven by robust semiconductor demand and reported foreign exchange intervention coordination among Korea, the U.S., and Japan. Physical memory chip demand remains strong despite volatility in Korean chip stocks, pushing memory prices to new highs.
AI-related semiconductor demand is fueling a terms-of-trade boom for the Korean economy, with the won beginning to reflect these gains. While interventions are smaller in scale than those for the Japanese yen, risks of further joint actions by authorities support a bearish outlook on USD/KRW.
DBS Group Research maintains a preference for short USD/KRW positions, citing ongoing intervention risks as a key factor.