Rhetoric Around Won Moves Continues From Officials

The post Asia close didn't deliver much fresh downside in USD/KRW 1 month. Dips in the pair towards 1333 were supported and we finished the NY session just under 1334. Note onshore spot closed yesterday at 1335.45.

• The set-up for the won still appears to be positive in the near term. The South Korea authorities stated this morning it was closely monitoring FX markets for signs of herd behaviour and will take step to stabilize the market if needed. This time the comments came from the Vice Finance Minister.
• This continues this week's theme of renewed focus on FX trends from South Korean officials.
• Such a backdrop, coupled with positive equity market sentiment, may bias USD/KRW lower further in the near term. As we noted yesterday the 1325/30 zone could see some USD support emerge.
• The market could retain some degree of cautiousness though, given the Jackson Hole symposium is kicking off.
• In the equity space, to recap, the Kospi gained +1.22% yesterday. Tech gains (SOX (+3.66%) and MSCI IT (+1.67%)) outperformed the main bourses overnight.
• Yesterday, offshore investors added a further $78.5mn to local stock holdings. This brings week to date inflows to +$325.9mn.
• The data calendar is quiet today, with retail/department store sales due to print for July between now and the end of the month.