South Korea's Ministry of Economy and Finance announced on Wednesday that, as part of the government's measures to promote US dollar supply, banks and other financial institutions will be temporarily exempt from paying the foreign exchange stabilization tax until June.

According to the ministry, this six-month measure will allow financial institutions to be exempt from paying this special levy. The exemption will be applied retroactively, effective from the beginning of January.

South Korea's existing mechanism requires financial institutions to pay the tax when they hold foreign currency liabilities exceeding a certain threshold. The tax waiver is expected to reduce the cost of foreign currency borrowing and increase the supply of US dollars in the foreign exchange market.

These measures come as the South Korean won continues to depreciate against the US dollar, although it rebounded today after South Korean President Yoon Suk Yeol delivered a speech expressing a bullish outlook on the currency. As of 3:00 PM local time, the won was trading at 1,470.3 per dollar, up 9.5 won from the previous trading session.