South Korea Watches FX Markets, Could Take Stabilisation Steps If Needed

Spot USD/KRW consolidates yesterday's gains and last trades at KRW1,265.15, barely changed on the day. Bulls look for renewed gains towards Mar 23 high of KRW1,282.60, followed by Mar 19 high of KRW1,296.75. Bears would be pleased by a pullback under Mar 15 high of KRW1,244.00.

• USD/KRW 1-month NDF last -1.55 fig. at KRW1,264.95. Topside focus falls on Mar 23 high of KRW1,279.46, while bears keep an eye on Mar 15 high of KRW1,247.94.
• FinMin Hong complained that USD/KRW has climbed "fast" this week, mainly due to external factors. He noted that officials are monitoring FX markets and stand ready to take stabilisation steps if needed.
• South Korean tech giant Samsung released its earnings report for Q1. Its consolidated net profit came in at KRW14.12tn, beating analysts' estimate of KRW13.42tn.
• North Korean Supreme Leader Kim appeared to have lowered the threshold for the deployment of nuclear weapons, at least rhetorically. He noted that Pyongyang's nuclear arsenal could be used "if there's an outbreak of an unwanted situation on this land."
• Business confidence among South Korean manufacturers rose to 88 from 85 prior in the BoK's monthly survey. Non-manufacturers' sentiment improved to 85 from 82. Note that both indices remained below the breakeven 100 level, suggesting that pessimists still prevail.
• Focus turns to South Korea's retail sales (today) and industrial output (tomorrow).