Dollar demand is intensifying in South Korea even as the won-dollar exchange rate retreats into the low 1,400 won range, with households and companies increasing both dollar deposits and dollar borrowing. Dollar-denominated deposits at KB Kookmin, Shinhan, Hana and Woori Bank reached $67.86 billion as of the 14th, up $6.34 billion from $61.52 billion at the end of the previous month, while dollar loans at the country's five major banks climbed to $8.69 billion at the end of July from $7.35 billion a month earlier. Individuals have been buying dollars at lower exchange-rate levels in anticipation of a rebound, while companies are holding export proceeds in dollars and borrowing directly in the U.S. currency for imports and working capital rather than converting won. Analysts said foreign net buying of South Korean stocks, improving semiconductor conditions, SK Hynix's American Depositary Receipt (U.S.-traded share certificate) capital repatriation and inflows tied to WGBI (World Government Bond Index) inclusion are helping push the exchange rate lower, but Middle East geopolitical risks and structural dollar demand are limiting how far the won can strengthen. Some market observers also warn that rising dollar hoarding in bank deposits could itself reduce dollar supply in the market and slow further declines in the won-dollar rate, while companies without natural hedging through dollar revenues could face foreign-exchange losses if the exchange rate reverses higher.