The won touched 1,334.7 per dollar in Seoul on Tuesday — the strongest the currency has been against the dollar since 4 October 2024, per the Seoul Economic Daily. It closed Friday at 1,345, and it was sitting in the high 1,400s in mid-July. That's a move of more than 220 won in roughly two months.

The cause isn't a rate decision. It's memory chips. Korea's August exports came in at $98.25bn, up 68.7% year on year — the third-biggest month on record — and semiconductor exports alone were $46.65bn, up 209%, a fresh record and the third straight month above $40bn. That's a wall of dollars landing in Korean corporate accounts, and when exporters convert it, they're selling dollars and buying won. SK hynix's $26.5bn ADR sale on 10 July, part of which was converted into won for domestic spending, added to the same flow.

The bit most people miss

Exporters are slowing down the conversion, not speeding it up — and the pile is enormous. Dollar deposits at Korea's five largest banks hit a record $76.98bn, with the corporate share at $63.3bn, as firms wait for a better rate, per The Korea Times. So the won has run to a two-year high on the flow that has already been converted. The queue behind it hasn't cleared.

Who actually pays for this

The chipmakers. Samsung and SK hynix bill in dollars but carry roughly 20% won-denominated costs, so a stronger won lands almost entirely on the profit line. Nomura reckons a 10% won appreciation cuts Korean memory makers' operating profit by about 12%. Citigroup has already trimmed its Q3 numbers — Samsung Electronics down about 10% (115.5tn to 104.1tn won) and SK hynix down about 3% (76.7tn to 74tn won), per the Seoul Economic Daily. The autos are in the same boat with none of the chip upside: Hyundai and Kia banked a combined 8tn won of currency gains between Q1 2023 and Q2 2026, averaging about 260bn won a quarter at Hyundai and 310bn at Kia. That tailwind is now running the other way.

So the Kospi is celebrating record chip exports while the currency those exports create quietly eats into what the chipmakers get to keep.

What flips it: the Fed. Markets are pricing roughly a 60% chance of a 25bp hike at the 16 September FOMC. A hike pushes the dollar back up and stalls the won — watch whether 1,350 holds into that decision. If it breaks lower instead, the Q3 estimate cuts probably aren't finished.

As of 8 Sep 2026, 10:00 IST. Sources: Seoul Economic Daily, Seoul Economic Daily, The Korea Times, Korea JoongAng Daily, Trading Economics. For discussion and education only — not investment advice. Verify before acting.