USD/KRW gapped higher at the open &......>

KOREAN WON: USD/KRW gapped higher at the open & touched its best levels in over

a month before drifting off highs, as a combination of factors weighed on the

won. The pair last trades at KRW1184.25, 2.80 figures higher.

- Situation on the Korean peninsula is tensed after Thursday saw Pyongyang

test-fire a new missile. N. Korea followed up with some combative rhetoric

today, saying that the test was a warning to "warmongers" from the South.

- Broader themes of the South Korea-Japan spat, spillover from U.S.-China trade

tensions and worries re: global slowdown continue to damage the outlook for KRW.

- Aforementioned geopolitical and trade tensions overshadowed yesterday's

release of better than expected GDP figures. The print defied earlier forecasts

suggesting that S. Korea might enter a technical recession.

- The Jun 10 high of KRW1186.15 limited gains overnight, a break here would

expose channel resistance at KRW1189.57. Bears look for a dip through

KRW1181.55, which would close the today's gap and open the 50-DMA at KRW1178.42.

- Looking ahead, South Korean industrial output comes out on Wednesday, while

CPI, trade balance and Markit m'fing PMI are due on Thursday.