KRW - South Korean Won

The history of the formation and development of the South Korean Won (KRW)

In 1902, the Korean Won was introduced for the first time to replace the Japanese Yen when Korea was still part of the Japanese Empire. With the aim of creating a distinct national currency for Korea.

After Korea was liberated from Japanese occupation in 1945, its value severely declined due to the impacts of war and the difficult economic situation.

In 1950-1953, the Korean War caused the Won to depreciate again, and it was reissued in 1953 after the war ended. The new Won was issued at an exchange rate of 1 new Won = 600 old Won.

In 1962, the South Korean government carried out a major currency reform, creating the Won with the currency code KRW, at a rate of 1 KRW = 100 old Won.

In 1997, the financial crisis occurred, severely affecting the Won and leading to its depreciation. The South Korean government, with the intervention of the International Monetary Fund (IMF), gradually saw the Won recover.

Currently, South Korea is one of the major economic powers in Asia. The Won is widely used in trade and international transactions.

South Korean Won (KRW) Denominations

Currently, the denominations of the South Korean Won issued include both banknotes and coins.

South Korean Won banknotes

• ₩1,000

• ₩2,000 (this denomination is issued specially for events)

• ₩5,000

• ₩10,000

• ₩50,000

South Korean Won coins

• ₩1

• ₩5

• ₩10

• ₩50

• ₩100

• ₩500

The denominations of the South Korean Won are designed with diversity and symbolize the nation's culture and history. 

South Korean Won (KRW) exchange rate

The current exchange rate of the South Korean Won against major foreign currencies is: 

• 1 USD = 1,365 KRW

• 1 GBP = 1,773 KRW

• 1 EUR = 1,444 KRW

Although the KRW is valued lower than the USD, GBP, and EUR, the South Korean Won is one of the popular and important currencies in the Asian region. 

The South Korean Won is not considered a strong currency because, despite South Korea's robust economy, it is still affected by international factors such as exports and global trade fluctuations.

Factors affecting the value of South Korean Won (KRW)

The value of the South Korean Won (KRW) is influenced by the following main factors:

Economic growth

Currently, South Korea's economic growth is facing many challenges, such as high import costs due to the weaker value of the Won. This leads to rising inflation and directly affects the value of the Won.

Exports and trade balance

South Korea is one of the largest exporting countries in the world, with sectors such as technology, electronics, and automobiles. However, the weakening global economy is reducing South Korea's export demand, leading to a decrease in the value of the Won.

Monetary policy of the Central Bank

Currently, the Central Bank faces the pressure of balancing between controlling inflation and maintaining economic growth. Therefore, whether increasing or decreasing interest rates directly affects the value of the Won in the market. When interest rates rise, the Won will become more attractive to foreign investors due to higher returns. However, if the BoK maintains low interest rates to stimulate the economy in the context of a weakening economy, the Won may depreciate.

National political situation

In the Northeast Asia region, South Korea is not only tense with North Korea but also has territorial disputes with Japan. In addition, there is the competition for influence from major powers such as China and the United States. 

When the political situation is unstable, investors tend to withdraw their capital from South Korea to seek safer markets, causing the Won to depreciate.

The value of the South Korean Won is dependent on many factors, making it increasingly sensitive to market fluctuations. Monitoring these factors helps analyze the current and future fluctuations of the KRW exchange rate.

Future of South Korean Won (KRW)

The future of the South Korean Won (KRW) is poised for significant influences arising from both domestic economic policies and global market dynamics. As South Korea continues to enhance its position as a leading technological innovator and exporter, the KRW is likely to benefit from increased foreign investment and trade surpluses. Additionally, the Bank of Korea’s monetary policy will play a crucial role in stabilizing the currency, particularly in response to inflationary pressures and shifting interest rates. However, the KRW also faces challenges stemming from geopolitical tensions in the region, fluctuations in global commodity prices, and the broader impacts of international economic conditions. Therefore, while the outlook for the KRW may exhibit resilience, it remains contingent upon a complex interplay of internal and external factors that merit careful observation for future valuation trends.