SK Hynix Listing Emboldens Korea’s Drive to Repatriate Dollars

A strong rebound in the won driven in part by SK Hynix Inc.’s record US listing has given South Korean authorities fresh impetus to prod exporters to repatriate their overseas dollars.

Having raised $26.5 billion in the deal, the chipmaker was seen selling dollars, setting the stage for a subsequent strengthening of the won. At a meeting last week, Vice Finance Minister Huh Chang urged exporters to convert a larger share of their proceeds into won and repatriate funds parked overseas.

Hynix’s dollar sales showed how a single firm’s move can shift the market. They likely affirmed Korean authorities’ decision to accelerate their months‑long campaign to boost the currency with help from the nation’s biggest exporters, rather than rely solely on reserves. The strategy wagers that company flows can succeed where direct intervention proves costly.

“What Hynix kicked off has snowballed into a broader wave of corporate dollar selling,” said Stephen Lee, an economist at Meritz Securities in Seoul. “Alongside dollar conversions tied to the company’s ADR proceeds, the won’s sustained strength is encouraging other companies that had put off converting foreign-currency earnings to start selling dollars.”

Hanwha Ocean Co. sold about $2 billion of dollar forwards in early July, with the shipbuilder also signaling for more sales. Net forward dollar sales by Korean exporters and importers reached an 18-year high of $17.4 billion in the second quarter, according to Bank of Korea data.

Samsung Electronics Co., Hyundai Motor Co., HD Korea Shipbuilding & Offshore Engineering Co., and Samsung Heavy Industries Co. were also among the companies called in by the authorities to repatriate funds and expand foreign-exchange hedging.

After hovering near its weakest since 2009, the won has rebounded about 6% in July against the dollar. For the month, it’s Asia’s best‑performing currency after having been the region’s worst in the first half. The spike came despite foreign investors selling about 13.6 trillion won ($9.3 billion) in Kospi-listed stocks, concerned about the durability of the AI-spending boom.

Pressure on the won hasn’t fully eased, with stocks volatile while Korea moves to implement its $350 billion US investment pledge. The decision to keep selling dollars ultimately rests with the firms.

But for now, officials are banking on good times to last. Corporate forward sales are set to grow further in the third quarter, Deputy Finance Minister Moon Jisung said in an interview. ADR proceeds and similar flows are less a temporary boost than the start of a shift in supply and demand, he said.

“It’s not that a passing shower is ending,” Moon added. “The monsoon season is beginning.”