[Economic Growth]: Both the US and South Korea's economic health significantly impact currency values. Strong US growth tends to strengthen the USD, while strong Korean growth strengthens the KRW. Relative growth differences are key.

[Interest Rates]: Higher US interest rates typically attract foreign investment, boosting USD demand. Conversely, higher Korean rates strengthen the KRW. Rate differentials are crucial.

[Inflation]: High US inflation can weaken the USD, as purchasing power decreases. Similarly, high Korean inflation weakens the KRW. Relative inflation rates matter more than absolute values.

[Geopolitical Events]: Global events, especially those impacting the Korean peninsula (e.g., North Korea tensions), can significantly affect the KRW's stability and investor sentiment, influencing the exchange rate.

[Trade Balance]: A US trade deficit (more imports than exports) can weaken the USD, while a Korean trade surplus strengthens the KRW. The balance of trade reflects demand for each currency.

[Government Debt]: High levels of US or Korean government debt can weaken their respective currencies due to concerns about fiscal stability and future repayment obligations. Perception is important.

[Market Sentiment]: Overall market risk appetite plays a role. During times of uncertainty, investors often flock to the USD as a safe-haven currency, increasing its value against the KRW and other currencies.

[Central Bank Policy]: Actions by the US Federal Reserve (the Fed) and the Bank of Korea (BOK), such as quantitative easing or intervention in currency markets, can have a powerful and direct impact on the USDKRW exchange rate.