The foreign exchange authorities made a net sale of $13.628 billion in the first quarter to curb the rise in the won-dollar exchange rate, the Bank of Korea said on the 30th. Calculated at the first-quarter average rate of 1,464.1 won, that amounts to 19.95 trillion won. It is the fourth-largest on record, following the all-time high in the fourth quarter of 2025 ($22.467 billion) and the second and third quarters of 2022.
When the won weakens and the won-dollar exchange rate rises, the foreign exchange authorities sell dollars they hold as a market stabilization measure. When dollars are supplied to the market, the won-dollar exchange rate falls. Foreign exchange reserves, however, decrease. Conversely, when the won-dollar exchange rate plunges, they buy back dollars supplied to the market, which increases foreign exchange reserves.
According to the "net foreign exchange authorities' transactions in the first quarter of 2026" released by the Bank of Korea that day, the foreign exchange authorities made net dollar sales for six consecutive quarters starting in the fourth quarter of 2024. They sold dollars to bring down the exchange rate, which had surged at the end of 2024 due to the martial law situation. The net sales over this period amounted to $45.352 billion.
Despite the efforts of the foreign exchange authorities, the high exchange rate continues. The won-dollar exchange rate closed at 1,549.4 won that day, up 4.2 won from the previous trading day. The weekly closing that day was the highest since Mar. 6, 2009 (1,550 won), during the global financial crisis. From the 15th of last month through that day, it has stayed above 1,500 won for 31 consecutive trading days. It is the second-longest after the foreign exchange crisis (49 consecutive trading days).