Story
South Korea Launches 24-Hour Won Trading in Push for Developed Market Status
Summary
South Korea has extended trading hours for the won-dollar market to operate nearly 24 hours a day. The reform is a major step in the country's effort to improve foreign investor access and secure an upgrade to developed-market status in global equity indexes.
South Korea initiated one of its most significant foreign exchange reforms in decades on Monday, launching round-the-clock trading of the won against the U.S. dollar. The move is a key part of the government's strategy to enhance market accessibility for global investors and strengthen its bid for inclusion in developed-market equity indexes.
The expanded trading hours allow the onshore won-dollar market to operate almost continuously on weekdays, aligning it more closely with major global currency markets. Previously, onshore trading was largely restricted to local business hours, which forced many overseas investors to rely on offshore non-deliverable forwards to manage their currency exposure.
This reform directly addresses a key obstacle cited by index provider MSCI for not upgrading South Korea to its Developed Markets Index. Improved accessibility for international investors was among the measures encouraged for reclassification. The overnight trading session will be supported by designated domestic lenders and registered international banks.
AdAuthorities expect liquidity in the extended hours to build gradually as more overseas institutions join the market. The currency reform is part of a broader government package aimed at modernizing South Korea's capital markets and easing access for foreign investors, with officials hoping the changes will further strengthen the country's appeal to the global investment community.