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1 Month USD/KRW Targeting Break Sub Nov Lows, BoK On Tap Tomorrow

KRW

1 month USD/KRW got close to recent lows in Tuesday NY trade. The pair fell to just under 1284, near Nov 21 lows at 1281.73. We ended Tuesday trade slightly higher near 1286, still a won gain of 0.81%. Note onshore spot closed yesterday at 1293.80.

  • A fresh break sub 1280 in the 1 month NDF would open up early August lows near 1273. Note the 20-day EMA sits back near 1304 on the topside.
  • The won benefited from broader USD weakness on Tuesday, rallying strongly along with other higher beta FX, as Fed dovishness saw US yields move lower.
  • Still, we had mixed tech equity trends, the SOX off 0.56%, while the MSCI IT rose 0.24%. To recap, the Kospi gained over 1% in Tuesday trade, with offshore investors adding +$56.9mn local stocks.
  • On the data front today, we have already had business sentiment readings for Dec. Manufacturing sentiment eased to 68 (from 69), but non-manufacturing sentiment rose to 71 from 69. Tomorrow we have the BoK decision, no change is expected.

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