Retail investors flock to buy dollars as won's value continues to drop

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Retail investors flock to buy dollars as won's value continues to drop

Published: 15 Jan. 2026, 11:08 Updated: 15 Jan. 2026, 16:24

Audio report: written by reporters, read by AI

Dollar banknotes are seen in this illustration taken on March 19, 2025. [REUTERS/YONHAP]

Retail investors in Korea rushed to buy dollars at the end of last year, taking advantage of a sharp drop in the won's value following government intervention in the currency market.

Despite repeated warnings from financial authorities, many investors expected the won-dollar exchange rate to continue rising and treated the dip as a buying opportunity.

From Dec. 24, 2025, to Tuesday, individual customers at Korea’s five major banks — KB Kookmin, Shinhan, Hana, Woori and NH Nonghyup — exchanged a total of $480.81 million in cash from won to dollars, according to financial sources on Thursday. The daily average for that period came to $22.9 million, more than double the $10.43 million daily average between January and November last year.

On Dec. 24 last year, financial authorities launched a verbal warning to lower the year-end closing exchange rate, which has a significant impact on the financial soundness of companies and financial institutions.

That day, the won gained 33.8 against the dollar, and the exchange rate continued to drop for three consecutive sessions through Dec. 29, 2025, falling from the 1,480-won range to the 1,420-won range.

Retail investors appeared to treat the drop as a window for bargain buying. On Dec. 24, 2025, alone, individuals at the five banks exchanged $63.04 million — close to a week’s worth of average trading volume. Some commercial bank branches even posted notices that $100 bills were temporarily unavailable.

Demand for dollars has remained strong in January, even as the exchange rate nears 1,480 won again. Individuals exchanged $17.44 million on Tuesday, about 70 percent higher than the January to November daily average from last year.

Market analysts say strong demand for dollars reflects expectations of further depreciation of the won, despite authorities’ efforts to stabilize the market. The won weakened every trading day for the first 10 sessions of this year through Wednesday, climbing to the upper 1,470-won range.

Analysts also expect the elevated exchange rate to persist.

"We expect the won-dollar exchange rate to average around 1,450 this year," said Park Hyung-jung, an economist at Woori Bank. "If external conditions turn more unfavorable for the won, the rate could rise above 1,480."

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY KIM JI-HYE [[email protected]]