1 Month USD/KRW Trades Above 1340, Authorities Looking To Curb FX Volatility

1 month USD/KRW got close to 1341 late in NY trade, as renewed equity risk off flows boosted broader USD sentiment. We were back at 1339 by the close. Yesterday onshore spot USD/KRW finished lower at 1332.40, as a flurry of late headlines, including one from Reuters which stated the authorities were suspected of selling dollars, curbed upside pressures.

• This is likely to remain a focus point in the near term, as a BoK official reportedly stated late yesterday that the authorities are looking at ways to reduce volatility in the FX market.
• Also in focus will be what comes out of President Yoon's summit with US President Biden, note tomorrow President Yoon will also address a joint session of US Congress.
• The equity lead for the Kospi was poor from Tuesday's US session: SOX off more than 3%, while the MSCI IT fell by 1.93%. However, US Nasdaq futures are up around 1.25% in early trade today following positive earnings news from Microsoft and Alphabet.
• To recap, Korean equities finished away from lows yesterday, but still down 1.37% for the Kospi, -1.93% for the Kosdaq as the FSS Chair warned around overheating markets.
• We have already had Apr consumer sentiment print, rising to 95.1 from 92.0, while inflation expectations further edged down (see this link).