The won fell against the dollar for the first time in 8 trading days as exporters' dollar selling prevailed ahead of the Chuseok holiday. Developments at the Bank of Japan and movements in the yen also influenced the market.
On the 21st, the won closed at 1,381.0 per dollar in intraday trading on the Seoul foreign exchange market, down 2.3 won from the previous business day and marking its first decline in 8 trading days. The won fell as low as 1,380.8 during the session, while also rebounding to 1,387.9, as the struggle over market direction continued.
The won initially rose after the open, but the US Federal Reserve's tightening stance and geopolitical tensions in the Middle East fueled dollar strength. Developments at the Bank of Japan drew attention as a key market variable, and concern also grew that they could curb yen appreciation.
At lower levels, dollar buying by foreign banks and settlement demand came into the market, preventing a further decline. There was also speculation that reports of the Bank of Japan conducting a rate check could affect the yen, heightening concern over the possibility of intervention during the holiday.
Export trends acted as a buffer for the exchange rate. South Korea's exports from 1–20 September totaled $71.4 billion, up 78.3% year on year, while semiconductor exports surged 259.4%. In South Korea's equity market, the KOSPI closed up 1.65% from the previous day at 7,007.72, and the KOSDAQ also rose, but foreign investors were net sellers of approximately KRW 16 billion.