Narrower Trade Surplus, Exports Growth Miss Help Undermine Korean Won

Spot USD/KRW starts the new week on a firmer footing, as the pair has reacted to greenback purchases seen after hours on Friday as well as the latest round of South Korea's trade data.

• The nation's trade surplus shrank to $1.690bn last month from $4.205bn prior, printing below median estimate of $2.100bn. The growth rates for both exports and imports were slower than forecast.
• Expansion in South Korea's m'fing sector almost ground to a halt in Oct, according to the latest M'fing PMI survey. Headline index deteriorated to 50.2 from 52.4, with IHS Markit noting that "ongoing raw material shortages and supply chain issues began to bite."
• Local CPI report, due tomorrow, takes focus from here. Headline inflation is expected to pick up and register at +3.3% Y/Y, according to Bloomberg consensus.
• Reminder that South Korea has eased social distancing measures effective today, as the nation moves to living with Covid-19 despite daily cases hovering around 2,000 over the last few days.
• Spot USD/KRW last operates +5.50 figs at KRW1,174.00, with bulls looking for a break above Oct 22 high of KRW1,180.40. This would clear the way to KRW1,188.40, which capped gains on Oct 18. Conversely, a retreat under Oct 26 low of KRW1,164.05 would bring the 100-DMA at KRW1,156.80 into view.
• USD/KRW 1-month NDF last seen at KRW1,175.36, little changed on the day. Bulls look for a jump above Oct 22 high of KRW1,181.32, while bears keep an eye on Oct 26 low of KRW1,165.03.