100-Day Moving Average Taken Out

Spot USD/KRW higher in early Asia on Friday, the pair up 4.85 at 1123.30 and above its 100-day moving average for the first time since June 2020.

• USD/KRW 1-month NDFs have continued their advance, the move higher accelerated as shorts covered amid onshore equity outflows. Contract hitting fresh ytd highs at 1123.40 at pixel time.
• Data released pre-market showed South Korea's current account surplus at $11.51bn in December, widening from $8.96bn previously. The goods balance widened to $10.49bn from $9.54bn previously.
• Risk assets are seeing some outflows after the decision earlier this week to extend the short-selling ban imposed in March last year to until early May. Observers say this has given the impression that the short selling ban artificially supported risk assets in South Korea, and so are anticipating a sharp negative shock when the ban is eventually removed, creating uncertainty.
• Elsewhere FinMin Hong Nam-ki will attend and take questions from lawmakers, participants will look for comments on another potential cash handout and extra budget, with a view to a change in issuance plans.