USD/KRW 1 Month Breaks Lower On Tech Equity Rally, BoK To Hold Steady Today

1 month USD/KRW broke out of its recent ranges to the downside in NY trade, as tech equities outperformed. We got to a low of under 1325, before closing near 1326, a gain in won terms of near 1%. This is lows in the pair back to the first half of August, while the 20-day EMA comes in at ~1319.5. Moves above 1340 have continued to cap the topside. Note onshore spot finished yesterday at 1339.80, so the early impetus will be to the downside when spot markets open today.

• On the data front we have already had the July PPI print, coming in at -0.2% y/y, similar to last month. The m/m result was +0.3%.
• We have the BoK decision today, with a firm hold expected at 3.50%. The policy bias implied by Governor Rhee is likely to be of greater interest (see our full preview here). Our sense is that the central bank will state rates have to stay restrictive for some time to ensure that inflation moves sustainably back towards target, while the bar for further rate hikes is likely to remain high.
• Elsewhere, the Kospi has a positive lead from Wednesday tech gains in the US. The SOX rose over 2%, the MSCI IT +1.84%, while US tech futures are higher in early trade today, as a strong revenue outlook from AI bellwether Nvidia boosted sentiment.
• To recap, the Kospi fell 0.40% yesterday, while offshore investors sold -$104.9mn of local shares.
• The other focus point will be on North Korea's failed rocket launch, which comes amid on-going US-South Korea military exercises.