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Korea has ample dollar liquidity to soften shocks to local currency, says BOK chief nominee

Published: 15 Apr. 2026, 16:29

Shin Hyun-song, nominee for the Bank of Korea governor [YONHAP]

The Korean won has remained relatively weak in recent months, but the country has sufficient dollar liquidity to respond to external shocks, Shin Hyun-song, nominee for the head of Korea's central bank, said Wednesday.

Shin made the remarks during his confirmation hearing at the National Assembly in Seoul, as he has been tapped to replace outgoing Bank of Korea (BOK) Gov. Rhee Chang-yong.

“It is not appropriate to comment on the specific level, but it is true that the exchange rate has remained at a fairly high level over the past few months,” Shin said. “Excessive currency depreciation is not desirable.”

The nominee, however, noted that the country's foreign exchange reserves remain sufficient to serve as a buffer against external shocks.

As a factor behind the won's weakness, Shin pointed to the significant influence of offshore transactions.

“There appears to have been a 'tail wagging the dog' phenomenon. Offshore non-deliverable forward trading involving the Korean won has played a significant role in the currency's depreciation,” Shin said.

“I will push to make the won more widely used globally and build an offshore settlement system so we can better manage the exchange rate and strengthen the currency's international standing,” he added.

The won had hovered around the psychologically significant 1,500 won-per-dollar mark before recently easing to around the 1,450 level, as the conflict in the Middle East pushed up global oil prices and rattled global markets.

Yonhap