South Korea's deputy finance minister has said that the Korean won may appreciate further.

South Korean Deputy Finance Minister Moon Jisung said on Tuesday that the Korean won may further appreciate, driven by an increase in corporate US dollar forward sales later this year. While the Korean won has strengthened against the US dollar recently, it is still below the level that the South Korean economy's fundamentals would suggest, Moon said. South Korea expects a "significant shift" in capital flows in the second half of the year; and the inflow of US dollars related to SK Hynix ADRs indicates that there is a more widespread change in market capital flows. Moon predicted that corporate US dollar forward sales in the third quarter will further increase; he also forecasted that South Korean companies will increase their spot and forward US dollar sales, especially in the semiconductor industry. "If the momentum of corporate spot and forward US dollar sales increases, it could also change the sentiment of retail investors, further accelerating the appreciation of the Korean won," Moon said.