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Equity Weakness Keeps 1 Month Above 1300

KRW

1 month USD/KRW stuck to recent ranges post the Asia close on Friday. Moves towards 1310 were capped, while on the downside we couldn't get beyond the 1305 region. The weaker equity impulse saw us finish at 1309.50. Note onshore spot finished at 1307 on Friday.

  • The local data calendar is quiet until Wednesday when the first 20-days of trade data is due for December. An onshore survey of domestically orientated export companies' projects export growth of 0.5% for next year, although tech related exports are expected to slip nearly 2%.
  • The National Pension Services (NPS) confirmed late last week it will raise its FX hedging ratio to 10% from 0%. This move was requested by the South Korean government earlier in December, so shouldn't come as a huge surprise to the market.
  • The equity lead is negative for the Kospi today, following US/EU weakness through Friday's session. Tech weakness was in line with broader market moves though. To recap, the Kospi finished close to flat on Friday, although offshore investors added just over $200mn to local shares.

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