Won and Asian FX: KRW, TWD, INR and ASEAN Currencies — 2026-10-12
The Korean won surged to a two-year low against the dollar as exporter conversions overwhelmed foreign selling, while the Indian rupee rallied sharply after the Reserve Bank of India (RBI) unveiled aggressive new measures to curb dollar demand. Meanwhile, the Indonesian rupiah faced renewed pressure near the 18,000 mark, prompting Bank Indonesia to intensify market interventions.
Won and Asian FX: KRW, TWD, INR and ASEAN Currencies — 2026-10-12
Top developments
Korean won hits two-year low on exporter flows
On October 12, the USD/KRW pair dropped to 1,335.10, marking the lowest closing level since October 2024. This decline was driven by heavy "nego" (dollar selling) volumes from Korean exporters converting overseas earnings, which outweighed foreign institutional investors' net selling in equities. The move signals strong underlying demand for the won from the real economy, despite broader risk-off sentiment in global markets.
RBI opens special dollar window to defend rupee
The Reserve Bank of India announced a special dollar window for state-owned oil companies and cut currency derivatives trading limits by 95% to reduce speculative dollar demand. Following these measures, the Indian rupee (USD/INR) jumped approximately 97 paise to open at 95.76 on October 12. This intervention aims to stabilize the rupee, which had been testing record lows amid high crude oil prices and foreign outflows.
Rupiah struggles near 18,000 threshold
Indonesian rupiah (USD/IDR) traded around Rp17,860–Rp17,900 on October 12, with analysts warning it remains vulnerable to breaking the psychological Rp18,000 level. Bank Indonesia has increased its presence in the spot and Domestic Non-Deliverable Forward (DNDF) markets to smooth volatility. The central bank's foreign reserves have declined, raising concerns about the sustainability of current intervention levels without additional liquidity support.
Local view
In South Korea, local media highlighted the divergence between the falling won and the declining KOSPI index, noting that exporter conversions are currently the dominant force in the FX market despite equity outflows. In India, Hindi-language outlets focused heavily on the RBI's "five major steps," including the direct supply of dollars to oil marketing companies, describing it as an unprecedented move to break the cycle of speculative dollar accumulation. Indonesian commentators emphasized that while BI is strengthening interventions, the rupiah's trajectory is increasingly tied to global crude oil prices and US yield movements.
Context & numbers
- USD/KRW: Closed at 1,335.10 on Oct 12, down 7.70 won from the previous session.
- USD/INR: Opened at 95.76 on Oct 12, up 97 paise from previous close following RBI announcements.
- USD/IDR: Trading range projected at Rp17,850–Rp17,950; JISDOR reference rate was Rp17,917 on Oct 5.
- BOK Reserves: The Bank of Korea released its September official foreign reserves data, though specific figures were not detailed in the immediate news wrap; the BOK also halted the disclosure of FX reserve rankings, citing misleading context.
On the radar
- RBI Implementation: Watch for the operational details of the special dollar window for oil companies and its impact on daily USD/INR spot volumes.
- Bank Indonesia Interventions: Monitor BI's daily intervention announcements for signs of reserve depletion or changes in strategy if the rupiah breaches Rp18,000.
- US Jobs Data Impact: Recent US payroll data (29,000 jobs) has lowered Fed hike odds, providing some relief to Asian currencies; continued weakness in US data could sustain the won's strength.
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