USD/KRW surges as US tariff threats hit Korean exporters, gold volatility spikes

USD/KRW gained 0.8% to 1,435.20 as the US announced new tariffs targeting Korean autos, lumber, and pharmaceuticals, intensifying Asia-Pacific trade tensions. The won weakened sharply with export-linked Korean equities tumbling - Hyundai Motor shares dropped 4% in early trading before paring losses. The tariff announcement caught markets off-guard, triggering risk-off sentiment across Asian currencies. South Korean authorities responded quickly, with ruling party officials introducing legislation to implement US investment commitments for expedited review. Meanwhile, gold and silver markets experienced extreme volatility with XAU/USD swinging 2.5% intraday as traders repositioned amid the trade uncertainty. Technical indicators show USD/KRW approaching resistance at 1,440, with support established at 1,425. The escalating trade friction could pressure the Bank of Korea's monetary policy stance, potentially limiting rate cut expectations for 2026.