Tech Equity Weakness Pushes USD/KRW Back Above 1290

1 month USD/KRW touched 1280 late in the Asia session on China's reduced covid-related travel restrictions. However, we pushed back above 1290 in US trading as weaker tech equities weighed. We closed in NY at 1291.6, while onshore spot yesterday ended at 1283.65.

• Tech leads are quite soft for Korea today, the SOX fell 2.63% overnight, the MSCI IT index nearly 3%, as tech underperformed broader equity market weakness. Weaker US data added to growth/recession fears.
• Yesterday, the Kospi managed a 0.84% gain, but the Kosdaq fell modestly. Offshore investors sold $210mn of local equities, reversing some of the positive trend seen in the previous two sessions.
• Earlier, Korean consumer sentiment fell to 96.4 from 102.6 in May. This is the lowest reading since the start of 2021. Inflation expectations climbed to 3.9%, the highest since April 2012, while households expected change in BoK rates rose to the highest level ever.
• Onshore news reports the BoK will weigh a 'big step' rate hike if June CPI hits 6% YoY. This would presumably be a 50bp hike. Note the CPI data prints on July 5.
• US Treasury Secretary Yellen will also visit South Korea on July 19-20th. This will form part of a regional trip, where sanctions, supply chains and energy prices will be discussed. In South Korea, FX stability could also be on the agenda in discussions, which is something won watchers will be mindful of.