The Impact of the Bank of Korea's Monetary Policy and Global Shocks on the Korean Won Exchange Rate (2008-2023)

This paper tries to value the effects of the Bank of Koreas monetary policies, and economic shocks on the world economy to the appreciation of the South Korean Won (KRW). Research is on the impacts of the BOK interest rate reactions, foreign exchange intervention and other monetary policy activity on the rate of KRW currency versus the other major currencies such as the USD, EUR and JPY. The KRW performance at such shocks, historical exchange rate data, BOK policy reports, and world economy events data, including the 2008 global financial crisis and 2020 COVID-19 pandemic, where the subject of this research was based on. The research findings are that the magnitude of the KRWs valuation is directly influenced by both domestic monetary policy and the world economy through increased volatility in times of uncertainty. These findings are used to generate implications for practical applications for investors in emerging market currencies to stress the necessity for knowledge on the roots of the forces that influence the KRW.