South Korean Won: AI-driven exports support KRW outlook – Commerzbank

FXStreet Insights Team FXStreet

Commerzbank highlights South Korea’s exports rising over 50% year-on-year in early July, marking a seventh month of double-digit growth, driven by semiconductors and AI-related data centre demand. The Bank of Korea (BoK) has started a tightening cycle, projecting a Base Rate near 3.0%, while officials expect stronger corporate USD-forward selling and capital inflows to support Korean Won appreciation despite recent USD/KRW gains.

BoK hikes as AI demand boosts trade

"South Korea’s exports in the first 20 days of July rose 52.3% yoy vs 60.4% in the same period of June. This marked the seventh consecutive month of double-digit export growth, suggesting external demand remains resilient despite ongoing supply chain disruptions linked to renewed tensions in the Middle East."

"On monetary policy, the Bank of Korea (BoK) hiked rates by 25bp to 2.75% last week, the first time in three years. It cited elevated price pressures and financial stability risks due to a weak KRW and rising home prices."

"It is expected to hike by another 25bp this year, taking the Base Rate to 3.0%. This will be in line with the BoK’s median rate projection in the latest dot plot."

"In FX, USD/KRW rose by 0.3% to 1,482 yesterday due to the firmer USD. Nonetheless, Deputy Finance Minister Moon Ji-sung sounded optimistic that KRW could strengthen due to increased corporate selling of USD forwards in H2. He said that this could “shift retail investor sentiment, further accelerating the KRW’s appreciation”."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD stays below 1.3400 after soft UK CPI data

GBP/USD struggles to gain traction and stays below 1.3400 in the second half of the day on Wednesday. The UK annual Consumer Price Index (CPI) inflation cooled to 2.6% in June against the market forecast of 2.7%, making it difficult for the British Pound gather recovery momentum. Meanwhile, investors keep a close eye on headlines coming out of the Middle East.

EUR/USD stabilizes near 1.1400 as markets focus on geopolitics

EUR/USD trades in a narrow channel at around 1.1400 on Wednesday. In the absence of high-impact data releases, escalating geopolitical tensions in the Middle East caps the pair's upside. On Thursday, the European Central Bank (ECB) will announce monetary policy decisions.

Gold extends rally as Middle East concerns intensify

Gold extends gains for the fourth consecutive day, standing comfortably above $4,100, unfazed by the risk-off market amid rising tensions in Iran and higher Oil prices. The pair has rallied nearly 2.5% so far this week and is on track for its best weekly performance in more than three months.

Australia unemployment rate set to steady at 4.4% in June, signaling strong job market

Australia will publish the June monthly employment report on Thursday at 01:30 GMT, and market participants expect a modest increase in job creation in the land Down Under. The Australian Bureau of Statistics is expected to announce that the country added 15K new jobs in the month, while the Unemployment Rate is forecast at 4.4%, unchanged from May.

Hyperliquid, Robinhood could lead crypto’s next bull market as DeFi and TradFi converge

The next crypto bull market could be driven by the growing convergence between blockchain-based financial infrastructure and traditional finance, according to Bitwise CIO Matt Hougan. In a report published late Tuesday, Hougan argued that crypto may be showing early signs of a market bottom, with Bitcoin gaining 9% since July 1 even as the NASDAQ 100 declined 6%.

US Dollar mid-year outlook: Exceptional currency, exceptional risks?

The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.