The Fed's Hike Just Cracked Korea's Won Rally — Is Seoul Cheap Again?

The Federal Reserve's first rate hike since 2023 landed on 17 September, and the ripple hit Seoul's currency within a day: the won gave back two weeks of gains, sliding from a one-year high near 1,330 per US dollar to 1,382 by 18 September — the sharpest one-day move since the spring. For Hong Kong travellers who watched Seoul get quietly pricier through August and early September as the won rallied, this is the first real crack in that trend. The question is whether it holds long enough to matter for an autumn trip.

The swing, in HKD

With HKD pinned near 7.8 to the US dollar, every won move passes straight through to what your cash buys in Myeongdong or Hongdae. This year's range, lined up:

• Mid-July, the weak-won peak: USD/KRW touched roughly 1,550, the cheapest Seoul has been all year. HK$10,000 converted to about ₩1,987,000.
• Early September, the one-year high: the won's rally dragged the rate down to roughly 1,330, making the same HK$10,000 worth only ₩1,705,000 — about ₩282,000 less, roughly a night and a half at a mid-range Myeongdong hotel.
• 18 September, after the Fed hike: USD/KRW snapped back to 1,382 in a single session, up 13.6 won on the day. HK$10,000 now buys ₩1,772,000 — about ₩67,000 more than two weeks ago, clawing back roughly a third of what the summer rally cost you.

Run that against a real bill: a three-night hotel stay priced at ₩900,000 cost HK$4,529 in mid-July, ballooned to HK$5,278 at September's peak, and has eased back to HK$5,080 after the hike — HK$198 cheaper than two weeks ago, but still HK$551 more than July's window for identical nights.

Why the discount might not last

This isn't a one-off wobble. A survey of 20 FX analysts published this week by Seoul Economic Daily put the won's "ideal" level at the low 1,300s, arguing a stronger currency now benefits Korean households more than it hurts exporters. That's the opposite of what a Hong Kong traveller wants: if the market agrees and pushes the won back toward 1,300, this week's discount reverses. The Fed itself has flagged another possible hike before year-end, which would widen the US-Korea rate gap further and could pull the won weaker again — but until that lands, the "ideal 1,300" camp is the stronger current in the room right now.

Booking around it

• Lock in won-denominated costs now — hotels, tours, anything quoted in KRW — while the rate holds above 1,380, rather than waiting to see which way the debate resolves.
• Convert cash in stages. A currency that moved 220 won in five weeks can move again just as fast, in either direction.
• Treat July's rate as a ceiling on your expectations, not a baseline. This week's bounce claws back some of the summer's damage, not all of it.

See Korea's currency swings against its own year of history on the destination page; for how we turn FX moves into one real-feel number, the methodology has the detail.