Korea to Open 24-Hour FX Trading to Woo MSCI Upgrade as Won Tops 1,410

SEOUL/NEW YORK - South Korea will move to around-the-clock trading in the won and build an offshore settlement channel, a reform President Lee Jae-myung unveiled to global investors in New York as the currency hovered above ₩1,410 per U.S. dollar. The package is designed to fix long-criticized access frictions and bolster Korea's bid to graduate into MSCI's Developed Markets basket. Reuters first reported the plan, noting that the 24-hour switch would ride on a new Bank of Korea FX network and, crucially, wouldn't require separate parliamentary approval.

The timing is deliberate. Korea extended its onshore FX hours to 2 a.m. KST in recent reforms to capture London trading; the next step is a full 24-hour window and legal room for offshore won settlement, two sticking points that MSCI has flagged for years in explaining why Korea remains an emerging market in its equity indices. Bloomberg and local dailies said the Finance Ministry will publish a road map this year to sequence the rollout and ease non-resident restrictions.

Currency moves have added urgency. The won broke back above 1,400 this week amid investor anxiety over still-unresolved Korea-U.S. tariff talks and a sturdier dollar. By Friday's close, the Finance Ministry's dashboard showed ₩1,412.4 per dollar, after early quotes topped ₩1,410.5 in Seoul. The day before, local press marked a ₩1,400.6 close, the first finish with a "4-handle" in roughly two months; late Friday morning it was still printing above ₩1,410.

Officials argue market plumbing-not just macro headlines-now matters for stability. President Lee warned in New York earlier this week that tariff bargaining mechanics are spooking FX, and that any large Korea-to-U.S. investment package would need credible dollar-funding backstops to avoid "won-bear" narratives taking hold. Analysts quoted by Reuters cautioned that, without such guardrails, the currency could explore weaker levels as talks drag; with them, better access and transparency could narrow spreads and draw steadier capital.

The 24-hour plan is therefore doing double duty: it signals openness to global money while giving locals more tools to hedge after hours. Korea has been criticized for an opaque, bank-intermediated FX structure with tight windows and limited non-resident participation. By letting trades occur continuously and allowing offshore settlement for bona fide investors, authorities hope to reduce the incentive to route risk through proxies in Singapore or New York and to align Korea with regional peers whose currencies are tradeable around the clock. The Korea JoongAng Daily reported that the Finance Ministry will pair market-hours reform with clearer settlement rules to address compliance concerns.

There are risks. Opening a 24-hour window can front-load volatility if overnight liquidity is thin at first and algorithmic flows dominate, particularly when domestic news hits after the close of cash equities. Regulators will need to stage the rollout, publish minimum market-maker obligations, and keep a close eye on best-execution outcomes for retail and SME hedgers. But the prize is meaningful: MSCI inclusion raises Korea's visibility in passive and quasi-passive mandates, while a more liquid FX chassis should help large equity and bond blocks clear without outsized currency slippage. Morningstar and other outlets said the roadmap is expected within the year, with implementation as early as next year if systems testing stays on track.

For readers, the near-term implications are practical. Families paying tuition or remittances can lock rates when they need them rather than racing a 2 a.m. cutoff. Small importers can build after-hours hedges when U.S. suppliers move prices. And if the U.S. tariff package lands with heavy dollar demand, a continuous market should make swap lines, interventions, or liquidity tools more surgical-less blunt than ad-hoc fixes deployed into a narrow window. Either way, the next milestones are clear: a Finance Ministry road map, Bank of Korea system specs, and MSCI's accessibility scorecards. With the won sitting north of ₩1,410, policy design could matter as much as the macro tape in how quickly the currency's pressure eases.