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KRW: Onshore Markets Return, Won Weighed By Yen & CNH Losses

KRW
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1 month USD/KRW ended NY trade near 1345, a won loss of 0.47%. This leaves us near recent highs (1348.7) in the pair. Broader won sentiment suffered as the yen and CNH lost ground amid higher US yields and on-going doubts around China stimulus. Onshore South Korean markets return today, Tuesday's closing level for spot was 1346.3. 

  • Upside focus for spot USD/KRW is likely to rest on a test of the post US NFP Friday highs just above 1352. This would also put us above the 100-day EMA. Beyond that lies the 1360 level. On the downside the 20-day EMA is back near 1334.
  • For the Kospi we closed under 2600 on Tuesday. The tech offshore lead has been positive in recent sessions, with the SOX up a further 1.06% in Wednesday US trade, while the MSCI IT index was also up by this amount.
  • Offshore investors have been net sellers of local equities so far this week (-$268.2mn).
  • The WGBI inclusion is seen as a positive, particularly for local bonds and flows may begin before the official entry date of Nov 2025. FX impact is not expected to be long lasting though.
  • The local data calendar is empty today, ahead of tomorrow's BoK decision. The central bank is widely expected to commence its easing cycle with a 25bps cut. 
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1 month USD/KRW ended NY trade near 1345, a won loss of 0.47%. This leaves us near recent highs (1348.7) in the pair. Broader won sentiment suffered as the yen and CNH lost ground amid higher US yields and on-going doubts around China stimulus. Onshore South Korean markets return today, Tuesday's closing level for spot was 1346.3. 

  • Upside focus for spot USD/KRW is likely to rest on a test of the post US NFP Friday highs just above 1352. This would also put us above the 100-day EMA. Beyond that lies the 1360 level. On the downside the 20-day EMA is back near 1334.
  • For the Kospi we closed under 2600 on Tuesday. The tech offshore lead has been positive in recent sessions, with the SOX up a further 1.06% in Wednesday US trade, while the MSCI IT index was also up by this amount.
  • Offshore investors have been net sellers of local equities so far this week (-$268.2mn).
  • The WGBI inclusion is seen as a positive, particularly for local bonds and flows may begin before the official entry date of Nov 2025. FX impact is not expected to be long lasting though.
  • The local data calendar is empty today, ahead of tomorrow's BoK decision. The central bank is widely expected to commence its easing cycle with a 25bps cut.