South Korean exports rose 70.9% YoY in June, driven by AI chip sales, while the KOSPI fell 2% as foreign investors booked profits.
South Korean Exports Hit Record High on AI Chip Boom
South Korea's exports surged 70.9% year-on-year in June, the fastest growth since 1978, fueled by unprecedented demand for AI chips. Semiconductor exports tripled annually, pushing monthly export values past $100 billion for the first time. Shipments to China and the U.S. rose sharply, while Middle East exports declined amid regional disruptions. The trade surplus hit a record, with the first-half total exceeding last year's full-year figure.
KOSPI Pulls Back on Profit-Taking After Strong Quarter
The KOSPI index dropped 2% on Wednesday as foreign investors booked profits following a 66% quarterly gain—the strongest since 1998. Despite record net selling in H1, foreign ownership of Korean equities by value increased, signaling room for further rotation. Chipmakers Samsung Electronics and SK Hynix led losses, alongside declines in battery, auto, and biotech sectors.
KRW Weakens as Bond Yields Rise
The Korean won depreciated against the dollar, while short- and long-dated bond yields climbed, reflecting broader risk-off sentiment. Factory activity expanded for a seventh straight month but at a slower pace, hinting at moderating export momentum. The external accounts surplus remains supportive of the KRW long-term, though near-term volatility persists.
Forex Implications: KRW/USD Sensitivity to Tech Sector Volatility
The KRW's weakness underscores its sensitivity to semiconductor sector swings. Traders may monitor AI-driven demand trends and central bank policy signals for directional cues. While the export backdrop supports the currency structurally, short-term corrections could test key support levels. Bond yield dynamics and risk appetite will also influence KRW/USD flows.
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