The won traded around 1,334 per dollar at about 11:30 a.m., stronger than Wednesday's daytime close of 1,337.7.
Government bonds also rallied. The three-year yield fell 4.4 basis points to 3.755 percent, while the benchmark 10-year yield declined 2.7 basis points to 4.081 percent.
The move was less pronounced further out the curve, with the 30-year yield edging up 0.7 basis point to 4.228 percent.
The moves followed the Fed's decision to keep its policy rate at 3.75 to 4.00 percent at the conclusion of its Oct. 27-28 meeting in Washington, following a 25-basis-point increase in September.
Fed governor Lisa Cook and Cleveland Fed president Beth Hammack favored another quarter-point increase. The Fed also upgraded its assessment of economic activity, describing it as expanding at a "strong" pace rather than the "solid" pace cited previously.
Fed chair Kevin Warsh, however, declined to signal the outcome of the next meeting.
"I don't believe in forward guidance absent exigent circumstances, absent a crisis," Warsh said at an Oct. 28 press conference in Washington. 'I also don't believe in prejudging meetings."
He said policymakers would have more information when they meet again in six weeks, giving them a better basis for deciding the appropriate policy stance.
At the same press conference, Warsh recalled his long policy dialogue with BOK Gov. Shin Hyun-song, saying, "I remember discussions with him about the use of the balance sheet" during the global financial crisis.
U.S. markets took the meeting as less hawkish than feared.
According to the BOK's New York office, the two-year U.S. Treasury yield fell 4 basis points to 4.70 percent and the dollar index slipped 0.2 percent to 102.13, while the 10-year yield rose 2 basis points to 5.02 percent.
Rate expectations eased as well, although markets continued to price another Fed move.
Fed funds futures put the probability of a 25-basis-point increase in December at 84.8 percent, down from 90.7 percent before the meeting. Cumulative tightening priced through the first half of next year eased to the equivalent of 65 basis points from 70 basis points.
The BOK held its base rate at 3.00 percent on Oct. 22 after consecutive increases in July and August, saying it needed time to assess the effects of earlier tightening.
Economic data released since then have continued to show solid growth alongside above-target inflation.
South Korea's economy expanded 1.0 percent from the previous quarter in the July-September period and 3.4 percent from a year earlier, according to advance BOK data released Tuesday.
Consumer prices rose 2.9 percent from a year earlier in September, while the index excluding food and energy increased 2.8 percent. Both remained above the BOK's 2 percent inflation target.
The November meeting therefore turns less on whether the Fed has given the BOK room to wait than on whether domestic inflation and growth justify using that room.
Kim Myung-sil, an analyst at iM Securities, said it was too early to call the Fed's pause the end of its hiking cycle, pointing to the dissenting votes for an increase and the stronger economic assessment.
An AJP poll ahead of the October meeting found all seven economists surveyed expecting a hold, while most saw the terminal base rate at 3.50 percent. November was widely seen as a possible timing for the next increase.
Karl Schamotta, chief market strategist at Corpay, called the smaller-than-expected number of Fed dissenters a "dovish surprise at the margin," while saying the stronger economic assessment still pointed to further tightening.
Long-term rates remain another constraint.
Ahn Ye-ha, an analyst at Kiwoom Securities, expects U.S. long-term yields to remain elevated as high oil prices, persistent inflation and fiscal concerns weigh on the market. She said a sustained decline would require clearer signs that those pressures are easing.
The BOK struck a similarly cautious tone at its market monitoring meeting at 8 a.m. Thursday.
The central bank cited continued tensions in the Middle East, fiscal sustainability concerns in major economies and uncertainty over artificial intelligence investment as risks that could again affect domestic financial and foreign exchange markets.
The U.S. cycle therefore reaches Korea through two channels: technology investment supports Korean exports, while U.S. rates and the dollar constrain the BOK. The Fed pause has eased the second channel for now, leaving Korea's own inflation and growth data to play a larger role in the Nov. 26 decision.
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