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SEOUL — The Bank of Korea’s strong measures to reverse the South Korean won’s slide against the U.S. dollar in July have largely been canceled out, as currency market prices showed Wednesday.

The won closed at 1,049.3 to the dollar Wednesday, a fraction below where it opened on July 7, when the Bank of Korea began selling $10 billion in foreign currency reserves in an effort to bring the exchange rate down to 1,000-to-1.

The result seems to be a win-win situation for U.S. servicemembers, at least until the end of the month.

The dollar buys more off-post goods and services than it did last month; meanwhile, the most recent bimonthly cost of living allowance adjustment boosted paychecks by factoring in last month’s less favorable exchange rate.

However, the stronger dollar in South Korea and throughout the world this month could act to reduce COLA next month. COLA can also fall when consumer prices in the U.S. rise relative to overseas prices, which may be happening now because of reports signaling higher inflation.

The South Korean government hasn’t announced any further currency intervention plans, though it most certainly would if its value dropped below 1,100-to-1, said Jang Jae-chul of the Samsung Economic Research Institute.

However, he doesn’t expect that to happen, barring an economic shock.

"Currently the won is being undervalued … if the market runs reasonably without a huge variation, the won should ultimately regain its own value in the latter half of the year," Jang said.

Jang and Shin Min-young, of the LG Economic Research Institute, both said that South Korea’s July dollar sell-off can’t be seen as a total failure. The won could have weakened further had the government not shown markets it was willing to defend the currency.

The Bank of Korea’s actions came up short, however, in part because of oil’s drop from about $147 per barrel to the $115 range.

"It is not only the Korean currency that dropped against the dollar," Shin said. "Other currencies are decreasing … reflecting the latest trends in the global money market."

Shin said he expects the won rate to hover around 1,050-to-1 for the rest of the year.

The dollar has gained about 15 percent against the won since November, when it bottomed out at 898-to-1.

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