The South Korean won climbed to its strongest level against the U.S. dollar in five months on Thursday, capitalizing on the Federal Reserve's decision to maintain its benchmark interest rate unchanged.
The move marks a notable reversal for the currency, which has faced persistent pressure in recent weeks amid broader dollar strength and regional economic uncertainties.
The won's appreciation reflects a broader shift in sentiment across Asian markets following the Fed's policy statement.
With the central bank opting for a hold, traders have recalibrated expectations for near-term rate cuts, reducing the yield differential that had previously weighed on emerging-market currencies.
The dollar index softened in response, providing tailwinds for regional peers including the Japanese yen and Chinese yuan.
Market participants had anticipated the Fed's decision, but the accompanying commentary reinforced a data-dependent approach that favors patience over immediate easing.