The South Korean won weakened against the U.S. dollar on Tuesday as market participants recalibrated their expectations for U.S. monetary policy.
Traders are increasingly pricing in the possibility of a Federal Reserve rate hike later this year, shifting sentiment away from the dovish stance that had supported the currency in recent sessions.
This repricing reflects a broader reassessment of the Fed's policy path.
As the probability of a rate increase rises, the yield differential between U.S. Treasuries and Korean bonds widens, putting downward pressure on the won.
The move underscores how sensitive emerging-market currencies remain to shifts in U.S. rate expectations, even when domestic fundamentals appear stable.
The current weakness contrasts with earlier forecasts from analysts and market participants at a recent Korea Financial Investment Association seminar, who had projected the won to strengthen toward the 1,450 level against the dollar in the second half of the year.