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U.S. puts Korea back on currency watchlist, makes rare remarks on weak won

Published: 30 Jan. 2026, 17:46 Updated: 30 Jan. 2026, 18:25

A bank official holds U.S. dollars at a Hana Bank branch in central Seoul on Nov. 5, 2025. [YONHAP]

The United States has again put Korea on its currency monitoring list, maintaining its decision made last June. There is no immediate penalty, but it adds another burden at a time when the two countries are already at odds over follow-up steps to a tariff deal.

In a semiannual report on the macroeconomic and foreign exchange policies of major trading partners that the U.S. Treasury Department submitted to Congress on Thursday, Washington named 10 economies for close monitoring: Korea, China, Japan, Singapore, Taiwan, Vietnam, Germany, Ireland, Switzerland and Thailand. Thailand was a new addition to the report.

Korea was first placed on the list in April 2016 and removed in November 2023, the first time it had been taken off in more than seven years. However, it was redesignated in November 2024, just ahead of the launch of the Donald Trump administration, and has remained on the list since.

As in the past, the United States pointed to Korea’s trade and current account surpluses. The Treasury Department said Korea’s current account surplus totaled 5.9 percent of GDP over the four quarters through June 2025, above the pre-pandemic five-year average of 5.2 percent. It also cited Korea’s bilateral trade surplus with the United States of $52 billion.

Under the Trade Facilitation and Trade Enforcement Act of 2015, the United States evaluates the macroeconomic and foreign exchange policies of the top 20 countries by trade volume with the United States, and can place them under enhanced analysis or on a monitoring list if they meet certain thresholds.

The current criteria are a bilateral trade surplus with the United States of at least $15 billion, a current account surplus of at least 3 percent of GDP, and net purchases of foreign currency for at least eight months in a 12-month period, totaling at least 2 percent of GDP. Countries that meet all three are subject to enhanced analysis, while those that meet two are placed on the monitoring list.

There are no direct disadvantages right away. The monitoring list is intended to discourage governments from artificially intervening in foreign exchange markets to boost competitiveness. Being listed does not mean the United States bans market-stabilization measures or takes immediate action.

An employee organizes U.S. dollar bills at Hana Bank’s anti-Counterfeit Countermeasures Center in Jung District, central Seoul, on Nov. 26. [NEWS1]

Still, some analysts say the designation could be used as additional leverage, as Trump has declared he could raise tariffs back to 25 percent, citing delays in investment commitments to the United States.

The report also includes an unusual comment on the won’s weakness.

“Notwithstanding these large external surpluses, the Korean won has come under sustained depreciation pressure and the authorities sold foreign exchange on net during the Report period,” said the report, stating how Korea’s “current account surplus and bilateral trade surplus with the United States have increased rapidly since mid-2023, driven by technology exports.”

“The won depreciated further in late 2025, which was not in line with Korea’s strong economic fundamentals.”

The Ministry of Economy and Finance said the wording suggests Washington views the won’s weakness in the second half of last year as excessive, adding that it will continue close communication with the Treasury Department and cooperation on foreign exchange market stability.

In Seoul’s foreign exchange market on Friday, the won closed at 1,439.5 per dollar in daytime trading, up 13.2 won from the previous session. The currency had been moving lower on broad dollar weakness before reversing course.

The local currency fell 13 won from the previous session to trade at 1,441.00 against the greenback at 3:30 p.m.

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 JANG WON-SEOK [[email protected]]