Investing.com — South Korea began round-the-clock trading of the won against the U.S. dollar on Monday, marking one of the country’s biggest foreign exchange market reforms in decades as Seoul seeks to improve market accessibility and strengthen its bid for inclusion in developed-market equity indexes.
The expanded trading hours allow the onshore won-dollar market to operate nearly 24 hours a day, bringing it closer in line with major global currency markets and allowing overseas investors to trade the currency outside Asian business hours.
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The reform forms part of South Korea’s broader push to secure an upgrade to MSCI’s Developed Markets Index, which has long cited restrictions in the country’s foreign exchange market as a key obstacle to reclassification. Longer trading hours were among the measures encouraged to improve accessibility for international investors.
The won traded weaker on Monday, with the pair rising 0.3%, after the currency rebounded late last week from its weakest level against the dollar since 2009. The recovery came after media reports stating South Korean authorities were preparing for currency flows linked to SK Hynix Inc’s () planned ADR offering.
South Korea had previously limited onshore dollar-won trading largely to local business hours, forcing many overseas investors to rely on offshore non-deliverable forwards to manage currency exposure.
The overnight trading session will be supported by designated domestic lenders and international banks registered to participate in the local foreign exchange market. Authorities expect liquidity to build gradually as more overseas institutions join the market. The government has also eased market access requirements for foreign investors as part of the broader reform package.
The launch marks another step in Seoul’s efforts to modernize its capital markets. The has climbed more than 30% this year, making it one of Asia’s best-performing major equity markets, led by AI-driven gains in heavyweight chipmakers and optimism over corporate governance reforms.
Officials hope easier access to the foreign exchange market will further strengthen South Korea’s appeal to global investors and support its case for reclassification.
Reporting by Roushni Nair