1 month USD/KRW Holding Above 1350, 2023 Highs Remain Within Striking Distance

1 month USD/KRW made a marginal fresh high in Monday trade, getting close to 1355. We finished the NY session at 1352.3, a modest won loss of just over 0.2%. We track slightly lower in early Tuesday trade, the pair last near 1351.6. Onshore spot is in the 1353/54 region in the first part of trade today.

• For the 1-month NDF focus will remain on whether we can test upside resistance in the high 1350/low 1360 region, which marked 2023 highs in the pair. The 20-day EMA continues to trend higher and was last near 1342.4.
• Cross asset was mixed for the KRW in Monday trade. Equity sentiment was modestly positive, although less so for US markets. The rise in US yields provided an offset, while rising energy prices has been biasing South Korea's terms of trade lower in recent months.
• South Korean stocks have opened up positively so far in early Tuesday trade (Kospi +0.60%). Yesterday offshore investors
• The local data calendar is empty today, but focus will rest on tomorrow's general assembly elections.
• Legislative election takes place with President Yoon Suk-yeol’s conservative People Power Party attempting to wrest back control of the National Assembly from the main opposition liberal Democratic Party of Korea. A win for the PPP could provide some impetus to Yoon’s reform efforts in the areas of pensions, education, and healthcare. It could also provide Yoon with a signal of public backing for the policy of pursuing closer links with the US and Japan since he came to office. Should the DPK retain control of parliament it would risk the remainder of Yoon’s sixyear term in office being a lengthy ‘lame duck’ period.