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  • SK Hynix Partners with Intel to Produce Advanced Memory in the U.S.
    SK Hynix Partners with Intel to Produce Advanced Memory in the U.S. SK Hynix is collaborating with Intel to produce advanced memory chips in the United States. This initiative aims to quickly establish a local supply base to meet the surging demand for artificial intelligence (AI) semiconductors from global tech giants. According to industry sources and foreign media on September 16, SK Hynix is in discussions to lease some production lines at Intel's semiconductor manufacturing facility under construction in Ohio to produce memory chips. The company is also seriously considering forming a joint venture with major cloud tech firms to jointly operate local production infrastructure. This move is seen as a strategy to secure a foothold in the U.S. supply chain for high-performance AI memory, such as high-bandwidth memory (HBM). Establishing a new semiconductor fabrication plant typically requires several years and tens of trillions of won in investment, but utilizing Intel's Ohio facility could significantly accelerate the production timeline. This approach is well-suited to respond promptly to the demands of big tech clients in the rapidly changing AI chip market. By forming a joint venture with big tech partners, SK Hynix can mitigate substantial initial investment risks while ensuring a stable supply of memory for data center construction in the U.S. Intel would also benefit from increased utilization of its Ohio facility and secure funding for its investments. If SK Hynix begins mass production of memory in the U.S., it will mark the first instance of a South Korean semiconductor company producing advanced memory chips on American soil. This would position the company at the center of the U.S. AI supply chain while allowing for a flexible localization strategy that adapts to the trade environment.* This article has been translated by AI. 2026-09-16 16:32:00
  • KakaoX CEO Appointee Kim Do-young: Establishing AI Identity Through Spin-off
    KakaoX CEO Appointee Kim Do-young: 'Establishing AI Identity Through Spin-off' Kakao is actively engaging with minority shareholders ahead of its planned spin-off. Following the announcement of the spin-off, concerns about the division ratio and potential damage to shareholder value have arisen, prompting the company to directly address these issues. Kim Do-young, the designated CEO of KakaoX and current head of Kakao Group's investment strategy, held an online meeting with minority shareholders on September 16, explaining that the spin-off aims to clarify the growth strategies and resource allocation for both KakaoX and KakaoAI."The goal is to establish a clear identity for our AI business so that we can be recognized as an AI company in the market, thereby enhancing shareholder value," Kim stated. He outlined plans to eliminate the conglomerate discount and accelerate growth for each business segment.The meeting included Kim Do-young, designated CEO of KakaoX, Shin Jong-hwan, CFO, Jeon Hyun-soo, head of business operations, and Hwang Yu-seon, head of growth strategy.Kim noted, "Since the announcement of the spin-off, we have conducted investor relations with both domestic and international institutional investors to gather various opinions. We have incorporated shareholders' inquiries into this explanation."He explained that the purpose of the spin-off is to optimize resource allocation and strategic execution by business area, while also clarifying KakaoAI's identity. The aim is to establish a foundation for KakaoAI to be recognized as an AI company in the market and ultimately increase shareholder value.Kakao cited the need to address the conglomerate discount, reassess its AI business, and improve decision-making and capital allocation efficiency as reasons for pursuing the spin-off. Over the past five years, 23 out of 27 non-routine agenda items discussed by the board were related to subsidiary support and restructuring, accounting for 85%, which hindered Kakao's ability to focus on its core business and investments.Kakao presented a combined business value of 34.2 trillion won, with an average market capitalization of 16.8 trillion won over the past three months, indicating a significant undervaluation of the company.KakaoX will focus on the growth of its tech-finance, content, and mobility subsidiaries, as well as investments in new businesses and innovative companies. KakaoAI will expand its revenue models based on AI, particularly in advertising and commerce, centered around KakaoTalk. KakaoX and its major subsidiaries will utilize over 6.4 trillion won in investment resources, while KakaoAI plans to concentrate on AI investments based on an annual EBITDA generation capacity of over 700 billion won.Kakao aims to increase combined revenue from 8.3 trillion won in 2025 to over 16 trillion won by 2030, with KakaoX targeting over 10 trillion won and KakaoAI aiming for over 6 trillion won.The shareholder return policies will be differentiated according to the business characteristics of both companies. KakaoX plans to use 30% of the after-tax dividends received from subsidiaries for dividends and share buybacks or retirements, and will consider special shareholder returns when investment gains occur. The company also plans to conduct a total of 300 billion won in share buybacks and retirements over the three years following the spin-off.KakaoAI intends to allocate 20-35% of its adjusted free cash flow for basic shareholder returns, with plans to increase the return rate to a maximum of 40% if free cash flow increases by over 50% compared to the previous year.Kakao plans to finalize the spin-off with a temporary shareholders' meeting on December 17, 2026, and execute the division on January 1, 2027, with KakaoX's new listing and KakaoAI's relisting scheduled for January 27 of the same month.* This article has been translated by AI. 2026-09-16 16:24:00
  • Education Officials Demand Review of Local Education Funding Reform
    Education Officials Demand Review of Local Education Funding Reform As the government seeks to overhaul the calculation method for the 'Local Education Funding' that has been a cornerstone of secondary education finance for 55 years, education superintendents from across the country voiced their opposition at the National Assembly. They criticized attempts to reduce public education funding under the pretext of declining student numbers, calling it a bureaucratic approach that ignores the realities of the education sector and hinders future investment in education. On September 16, superintendents from 16 provincial and metropolitan education offices held a joint press conference at the National Assembly, demanding a comprehensive review of the 'Local Education Funding Reform Proposal' submitted by the government on September 3. The government's proposal aims to abolish the existing 'domestic tax linkage (20.79%)' method and replace it with a new formula that reflects economic growth rates and changes in the school-age population. Chairman Jeong Geun-sik, who is also the Superintendent of Seoul Metropolitan Office of Education, described the reform as a significant issue regarding how the state guarantees educational resources and maintains educational autonomy. He rebutted the government's claim of a '7.2 trillion won increase in funding' as a statistical illusion, stating that the actual increase compared to this year's funding is only 2.4 trillion won. When accounting for the expiration of various compensatory funds and reductions in national funding for free high school education, the net increase is merely 225.9 billion won, representing a growth rate of just 0.3%. In contrast, the natural increase in personnel costs and essential expenditures due to national policy initiatives, such as the 'Early Spring School' and integration of childcare, is expected to surge by over 3.14 trillion won, putting educational finance in a serious deficit, according to the superintendents. The education officials pointed out that the biggest flaw in the government's proposal is the simplistic economic logic that equates declining student numbers with reduced educational costs. They emphasized that even with fewer students, costs for maintaining schools and classes in overcrowded new cities and underpopulated rural areas continue to accrue. They also raised concerns about the urgent need for improvements to aging school facilities, support for increasing numbers of special education and multicultural students, ensuring basic academic skills, mental health support for students, and the introduction of AI digital textbooks, all of which contribute to rising educational demands. Chairman Jeong warned that the new formula lacks any mechanisms to adjust funding based on personnel costs, operational expenses, and increasing educational demands. He cautioned that this burden would lead to a contraction in educational activities and widen educational disparities, ultimately affecting students who need more support the most. He reiterated, 'A decline in student numbers should not be a reason to cut educational funding; rather, it should be an opportunity to provide better education to each student.' The council presented three strong demands to the National Assembly: Thoroughly verify the scale of funding reductions compared to current laws and their impact on educational autonomy. They called for clear disclosure of the basis for calculating the standard amounts and the objective rationale for reflecting a 35% change in the school-age population, as well as the establishment of a funding adjustment mechanism to accommodate increasing educational demands. Given the complexity of this reform, which intertwines with future response funds, education tax distribution, and local finance reform, they argued that relevant committees, including the Finance and Economy Committee and the Administrative Safety Committee, should jointly review the entire financial structure rather than leaving it solely to the Education Committee. Finally, the council officially requested the National Assembly Speaker to exclude this bill from being designated as a supplementary law to the revenue budget proposal to prevent it from being rushed through without adequate review. Concluding the press conference, Chairman Jeong stated, 'To change a system that has been the foundation of educational finance for 55 years, there must be sufficient evidence and social consensus that the new system can provide more stable educational guarantees for children.' He urged the National Assembly to make responsible judgments and develop alternatives.* This article has been translated by AI. 2026-09-16 16:20:00
  • National Assembly Continues Confirmation Hearings Amid Dispute Over Ministerial Nominees
    National Assembly Continues Confirmation Hearings Amid Dispute Over Ministerial Nominees The Democratic Party and the People Power Party continued their debate over the qualifications of five ministerial nominees during the second day of confirmation hearings on September 16. The People Power Party urged the withdrawal of nominations for Kang Shin-cheol, the nominee for Minister of National Defense, and Hong Ji-sun, the nominee for Minister of Land, Infrastructure and Transport. In contrast, the Democratic Party emphasized the expertise of both candidates, calling for cooperation in the hearings.Jung Jeom-sik, the floor leader of the People Power Party, held a press conference at the National Assembly, stating, "Both nominees are unqualified and should have their nominations withdrawn. We need to appoint new individuals who can boldly reform the government."He criticized Kang for failing to report his son's commercial property purchase, questioning, "How can a Minister of National Defense respond to North Korean provocations if he is unaware of his son borrowing 700 million won?" Regarding Hong, he expressed concern that the real estate policies would continue to be influenced by the Seongnam and Gyeonggi-do connections that have been part of the Lee Jae-myung administration, which he believes has failed in its policy direction.On the other hand, Han Byeong-do, the floor leader of the Democratic Party, argued during a Supreme Council meeting in Daejeon that both security and housing stability are directly related to the lives and daily routines of the people, stating, "We do not have time to waste on partisan tactics." He emphasized that Kang is a four-star general and a seasoned expert in security and military strategy, while Hong is an expert in urban, housing, and transportation administration, having served as the head of urban housing in Gyeonggi-do and as the second vice minister of the Ministry of Land.The exchanges between the two parties continued in the confirmation hearing. Lim Jong-deuk, the People Power Party's secretary for the National Defense Committee, questioned the lack of witness selection, stating, "How can we proceed with verification when the verification through witnesses is blocked and relevant materials are not properly submitted?" In response, Democratic Party secretary Kim Byeong-joo accused the People Power Party of trying to turn the hearing into a political offensive by demanding witnesses from the Blue House personnel line, including Kang Hoon-sik, the chief of staff.The debate surrounding Kim Seung-won, the nominee for Minister of Justice, also continued. Jung criticized the Democratic Party for turning the hearing into a melodrama, stating, "They couldn't even provide a proper explanation for their own allegations, and instead exchanged tears. The Democratic Party is conducting the hearings in a biased manner while offering embarrassing praise. Is this a confirmation hearing or a political 'super chat'?"He referenced the case of Cho Kuk, the former Minister of Justice, who was appointed despite negative public opinion in 2019 but resigned after just over a month, suggesting that Kim could also face protests if appointed.In contrast, Seo Young-kyo, chair of the Legislative and Judiciary Committee, and Democratic Party secretary Kim Ui-gyeom held a press conference at the National Assembly, stating, "No significant disqualifying factors that would obstruct the performance of duties have been identified," urging the People Power Party to stop unnecessary allegations and cooperate in adopting the confirmation report. Seo emphasized the urgency of filling the current vacancy in the Ministry of Justice, stating, "As chair, I will strive to expedite the adoption process. We will work together to resolve this issue."* This article has been translated by AI. 2026-09-16 16:20:00
  • Chinese Stock Market Rises After Five Days of Decline, Strong Performance in Optical Module Sector
    Chinese Stock Market Rises After Five Days of Decline, Strong Performance in Optical Module Sector On September 16, the Chinese stock market rebounded after five consecutive days of decline. Analysts attribute this recovery to a technical rebound following the recent downturn. The Shanghai Composite Index closed up 0.71% at 3,891.60, the Shenzhen Component Index rose 1.26% to 13,454.74, and the ChiNext Index increased by 1.96% to 3,311.47.The market had faced four days of losses due to rising interest rate risks in the U.S., soaring oil prices, and corrections in U.S. tech stocks. As the prolonged decline was seen as excessive, bargain hunting emerged. While the Chinese stock market successfully rebounded, some analysts suggest that a stronger upward trend is needed to confirm a sustained recovery.Additionally, the U.S. 10-year Treasury yield stabilized around 5%, and international oil prices saw a slight decline during Asian trading, contributing to the rebound in the Chinese market. There are also indications that the concerns regarding further deterioration in the market have eased, rather than a complete resolution of negative factors.Furthermore, the People's Bank of China issued a message emphasizing its commitment to maintaining stable operations in the stock market, which bolstered buying interest. According to the Financial Times, Chinese securities regulators are managing IPO prices and volumes to maintain investor confidence and market stability.Notably, stocks related to optical modules saw significant gains. Major companies such as Dongtianwei, Xinyi Technology, and Tianfu Tongxin all recorded substantial increases. Zhongjin Securities reported that some optical chip companies in China have secured orders through 2028, and the order backlog for optical module firms is already filled for next year's supply, predicting continued high demand for optical modules next year.The semiconductor materials sector also showed strength, with companies like Youyangu and Zhongjing Keji hitting their upper price limits. Citic Securities noted in a report that the supply of silicon wafers remains extremely tight, and wafer producers are likely to raise supply prices next month. They further projected that price increases will continue not only this year but also into next year.Meanwhile, the People's Bank of China set the yuan's central parity rate against the dollar at 6.7628 yuan, a decrease of 0.0042 yuan from the previous day, reflecting a 0.06% increase in the value of the yuan.* This article has been translated by AI. 2026-09-16 16:16:00
  • Kang Shin-cheol Responds to Sons Military Record Request: Check at the Unit
    Kang Shin-cheol Responds to Son's Military Record Request: 'Check at the Unit' Kang Shin-cheol, the nominee for Minister of National Defense, faced criticism for his response during a confirmation hearing on September 16, where he suggested that inquiries about his son's military service records should be made directly at the unit. During the hearing before the National Assembly's Defense Committee, lawmaker Cheon Ha-ram raised concerns about a KakaoTalk profile picture of Kang's son, who served as an Army second lieutenant. Cheon claimed that the photo, taken with his 4-star general father, raised suspicions of favoritism during his service. Cheon argued, "If the candidate does not reach out, just displaying that photo would make all unit members aware that he is the son of a 4-star general, leading to special treatment." He insisted on the need to verify whether any favoritism occurred during the service. Cheon also pointed out that the requested military record had not been submitted, questioning whether the Lee Jae-myung administration's philosophy prevented the release of such documents. He referenced the case of An Gyu-baek, the Minister of National Defense, who also failed to provide his military records amid allegations of desertion. In response, Kang stated, "Please go to the unit and check how our son served," escalating the exchange. Cheon retorted, "Should I, as a committee member, have to ask each individual? Are you saying that I should go check because you can't provide the military record? Is that the attitude of a ministerial candidate?" Jin Sung-jun, the chair of the Defense Committee, intervened, stating that Kang's suggestion to check at the unit was inappropriate. He emphasized that Kang should actively clarify and prove that no favoritism occurred during his son's military service. Jin also noted that while the submission of military records requires the consent of the individual involved, it would be beneficial to provide the records to demonstrate that Kang's son did not receive any special treatment during his service as the son of a 4-star general. On the other hand, Kim Seong-hwa, a member of the Democratic Party, raised concerns about Cheon's demands, stating, "While it is acceptable to request clarification on existing suspicions, questioning the very existence of the records is problematic." Kang expressed regret over the issue of submitting the military record, stating, "I will look into it."* This article has been translated by AI. 2026-09-16 16:16:00
  • Construction Companies Compete for Yongsan Redevelopment Projects
    Construction Companies Compete for Yongsan Redevelopment Projects Construction companies are accelerating their bids for redevelopment projects in Yongsan. As the Sukdaeipgu Station area begins its contractor selection process, major builders are already visiting the Hyocheong Park area, which has not yet established a residents' association. They are assessing the location and project viability while introducing their brands to residents in preparation for future contract opportunities.According to the redevelopment industry on September 16, projects such as the Hyocheong Park area, Cheongpa 2 District, and Sukdaeipgu Station area are progressing in the western Yongsan region.The largest project, the Hyocheong Park area, is still in the promotion committee stage, but significant movements from major construction companies have been detected. The project, located in the area of Hyocheong-dong 5-307, will cover 103,402 square meters and is expected to include up to 40 floors and approximately 3,000 housing units.After receiving approval for the establishment of the promotion committee in April, the third committee meeting will be held this afternoon to discuss contracts with key partners, including architects, project management firms, urban planning companies, and appraisers for estimating shared costs. The committee aims to establish the residents' association by the end of this year or early next year.While the contractor selection process is still pending, some construction companies are already visiting the site to evaluate its viability. A local real estate agent noted, "Recently, representatives from major construction firms such as GS Construction, Hyundai Construction, and Daewoo Construction have been visiting the Hyocheong Park area. Although the residents' association has not yet been established, they seem to be visiting to introduce their companies to residents with an eye on securing future contracts."In the nearby Cheongpa 2 District, located at 89-18 Cheongpa-dong 1-ga, the residents' association received approval for establishment in June and is currently undergoing procedures for modifying the redevelopment plan and selecting partners, including architects. As the association is formed and subsequent procedures begin, interest from the construction industry is expected to grow regarding the contractor selection.The fastest-moving project is in the Sukdaeipgu Station area, located at 52-6 Galwol-dong, Yongsan. Last month, a bid announcement for contractor selection was issued, with the deadline set for October 8. According to the integrated review plan, the site will cover 26,493.5 square meters and will include a total of 900 housing units and community facilities.At the site briefing held by Daesin Asset Trust at the end of last month, five companies, including IPARK Hyundai Industrial Development, Dongbu Construction, Geukdong Construction, Jeil Construction, and Jinheung Enterprise, participated.Construction companies are reviewing the location, project scale, floor area ratio, and general sale volume to select projects to bid on. If they determine the project is viable, they begin engaging with residents even before the contractor selection process starts.A representative from a major construction company stated, "If a project is deemed viable and aligns with our housing brand, we sometimes enter the process early, even at the promotion committee stage. Ultimately, the basis for assessing the viability of a redevelopment project is the expected sales revenue, so the potential volume of general sales is crucial." 2026-09-16 16:12:00
  • Government Considers Purchase Price for Knowledge Industry Centers Converted to Housing
    Government Considers Purchase Price for Knowledge Industry Centers Converted to Housing The government is pursuing a plan to convert vacant knowledge industry centers into residential spaces to increase housing supply, making the determination of purchase prices a key issue. The prices vary significantly due to discounted sales, urgent sales, and auction results, and additional construction costs are required for the conversion. Experts argue that a price assessment reflecting current market value, along with costs for changing usage and remodeling, is necessary for actual supply to materialize.According to a report by Aju Economy on September 15, the Korea Land and Housing Corporation (LH) plans to calculate prices for its non-residential remodeling rental project by selecting one appraisal firm each from LH and the Korea Association of Property Appraisers. LH stated, “We plan to determine the purchase price based on the arithmetic average of the two appraisals.”However, the price variations for knowledge industry centers are significant. Prices differ even within the same area based on location, year of completion, number of floors, and the ratio of supporting facilities, with discounted sales and auction prices forming simultaneously. It is crucial to identify which cases accurately reflect market value.According to Knowledge Industry Center 114, the number of court auctions for knowledge industry centers in the metropolitan area increased by 24% in the second quarter of this year, reaching 1,530 cases, up from 1,233 in the previous quarter. Compared to 594 cases during the same period last year, this represents a 2.6-fold increase. The auction success rate was 51.5%, the lowest since 2020.Nam Kyung-jin, head of the Korea Association of Property Appraisers, noted, “Knowledge industry centers have the characteristics of collective buildings, so they are likely to be appraised using the comparative sales method. We need to comprehensively review transaction cases, auction results, and market fluctuations at the time of the assessment to select the cases that best reflect market value.”He added, “Given the large volume of knowledge industry centers and the high market volatility, it is essential to closely examine changes in market conditions relative to the sale price, and the specific evaluation methods may vary depending on individual cases.”Post-Purchase Remodeling Costs and Usage Change ChallengesThe criteria for comparing prices also vary depending on the business model. LH is using a direct purchase method for acquiring buildings and changing their usage and remodeling, while a purchase agreement method allows LH to buy buildings remodeled by private entities. The purchase agreement method appraises the building based on its condition after remodeling and changing usage, making simple comparisons with existing transaction prices difficult.The costs required for conversion to residential use also affect the project's viability. Even if existing buildings are acquired at a low price, high costs for altering internal structures and equipping residential facilities can diminish the price advantage.Kang Eun-hyun, head of the Auction Research Institute, stated, “Knowledge industry centers are experiencing price weakness due to economic downturns and oversupply, and converting them to residential use incurs additional construction costs for underfloor heating, bathrooms, and kitchens.” He emphasized that both current transaction prices and conversion costs to residential use must be considered.Professor Yoo Seon-jong of Konkuk University added, “Knowledge industry centers are not originally designed as residential spaces, so significant costs will be incurred during the usage change and remodeling process. It is essential to consider not only the acquisition cost but also the additional capital expenditures required to convert them into residential spaces.”The layout is also a variable. The process of converting spaces designed for business and production facilities into residential use may reduce their utility. Professor Yoo explained, “Knowledge industry centers may have layouts that are elongated, making them inefficient for residential use. It may be worth considering combining two or three units to create an officetel.”Even if the price and construction cost conditions are met, safety and facility requirements for residential use must be satisfied. An LH official stated, “We will closely review the legal changes in usage to ensure compliance with safety standards, including fire and evacuation criteria, as well as the requirements necessary for residential use.”* This article has been translated by AI. 2026-09-16 16:04:00
  • Homeplus struggles to regain footing after court rescue
    Homeplus struggles to regain footing after court rescue SEOUL, September 16 (AJP) - Homeplus is generating only about 40 percent of its targeted sales two weeks after securing court approval for its rehabilitation plan, forcing it to split overdue wages into two payments, according to industry sources on Wednesday. The hypermarket chain reportedly told its two labor unions that revenue was falling short of what it needs to meet repayments under the plan. Unpaid July wages will be paid in two installments on Sept. 23 and 30, with payments to suppliers for goods ahead of the Chuseok harvest holiday taking priority. Management also floated a voluntary redundancy program but shelved it after the unions balked, and discussed whether and when to close its Paju Unjeong store. Homeplus' unpaid wages totaled 387.1 billion won ($282.9 million) from December 2025 through August, according to Ministry of Employment and Labor data. The Chuseok bonus payment date has yet to be set. Homeplus, acquired by private equity firm MBK Partners in 2015 for about 7.2 trillion won, filed for court receivership in March 2025 after a credit rating downgrade squeezed its short-term funding. The Seoul Bankruptcy Court approved the plan on Sept. 2, two months after it had ordered the proceedings terminated, a decision Homeplus appealed after securing 200 billion won in emergency funding from Meritz Financial Group. The sale of the hypermarket business has yet to gain traction. Samil PwC, the sale manager, plans to send teaser letters to major domestic and foreign companies soon, and Homeplus aims to secure at least one interested bidder by October. AJP Takeaways - Homeplus is generating about 40 percent of its targeted sales and will split unpaid July wages into two payments on Sept. 23 and 30, 2026, after the Seoul Bankruptcy Court approved its rehabilitation plan on Sept. 2, 2026. - Homeplus' unpaid wages totaled 387.1 billion won from December 2025 through August 2026, according to Ministry of Employment and Labor data submitted to lawmaker Kim Wi-sang. - Homeplus, owned by MBK Partners, aims to secure at least one interested bidder by October 2026, with Samil PwC preparing to send teaser letters to potential buyers. 2026-09-16 16:01:19
  • Korean Won Strengthens Against Dollar, Down 9% in Six Months
    Korean Won Strengthens Against Dollar, Down 9% in Six Months The won-dollar exchange rate has dropped nearly 9% over the past six months, reflecting a strengthening of the Korean won. As the dollar's strength has eased since last year and domestic supply conditions have improved, the exchange rate, which once exceeded 1,500 won, has fallen to the mid-1,300s.On September 16, the exchange rate in the Seoul foreign exchange market was recorded at 1,368.6 won per dollar, an increase of 9.2 won from the previous day's closing price of 3:30 PM. This marks a significant rise in the value of the won, which had been above 1,500 won just two months ago.The recent decline in the won-dollar exchange rate has been influenced by improved supply conditions in the domestic foreign exchange market and a weakening dollar. Notably, strong semiconductor exports have led to an increase in dollar sales by exporters, contributing to the won's strength.However, factors are emerging that may limit further declines in the exchange rate. The influx of dollar sales from exporters, which had previously driven the exchange rate down, is becoming uncertain. Additionally, concerns surrounding U.S. monetary policy are growing.The U.S. Consumer Price Index (CPI) for August rose by 0.4% compared to the previous month. The core CPI, which excludes volatile food and energy prices, increased by 0.3%, surpassing market expectations and raising concerns about the Federal Reserve's tightening policy. Coupled with geopolitical risks in the Middle East and rising international oil prices, there is increasing pressure for a stronger dollar.International oil prices have surged to around $100 per barrel, reigniting fears of global inflation. If inflationary pressures persist longer than expected, the Federal Reserve's monetary policy may be less accommodative than the market anticipates. This could limit the dollar's weakness and support the lower end of the won-dollar exchange rate.Internally, the Bank of Korea has expressed concerns that it is difficult to assess the current value of the won based solely on past exchange rate levels.One monetary policy committee member noted during the August monetary policy direction meeting that there have been ongoing discussions about the appropriate exchange rate level being higher than in the past. There is a need to develop indicators that can assess whether the current exchange rate level and trend are appropriate, reflecting changes in economic conditions such as the development of financial markets.Particularly, as the effective exchange rate currently used by the Bank of Korea is calculated based on trade weights, there are suggestions to create a new won index that incorporates recent significant increases in domestic investors' overseas securities investments and foreign investors' domestic securities investments.This indicates that, given the substantial increase in cross-border capital movements compared to the past, the criteria for determining the appropriate exchange rate level may also change. It has become challenging to conclude that the value of the won has increased simply by comparing it to historical exchange rate levels now that it has fallen to the mid-1,300s.Market sentiment leans toward the possibility of limited further declines in the won-dollar exchange rate or a short-term rebound. As the influence of domestic supply factors weakens, the Federal Reserve's monetary policy, international oil prices, and dollar trends may introduce new variables affecting the exchange rate.Choi Kyu-ho, a researcher at Hanwha Investment & Securities, stated, "For the time being, we expect the won-dollar exchange rate to stabilize around the 1,320 won level. As the influence of domestic supply factors, which had previously driven a unilateral appreciation of the won, weakens, and with the likelihood of the Federal Reserve raising interest rates, the pressure for a weaker dollar is expected to be significantly limited or may even turn into a stronger dollar in the near future."* This article has been translated by AI. 2026-09-16 16:00:20