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KRW: USD/KRW Close To 20-Day EMA Support, Trade & GDP Next Week

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Spot USD/KRW has maintained recent ranges in the first part of Friday dealing. We were last near 1456, slightly stronger in won terms for the session. Lows this week came after the surprise BoK hold, but the pair bottomed out just under 1450, with BoK board members still strongly in favor of another cut in the next 3 months. Governor Rhee also highlighted downside economic risks. 

  • Spot USD/KRW has tested 20-day EMA downside support a number of times this month. This support level is near current spot levels (1355). A fresh break lower may see early Jan lows, just under 1445 targeted. The 50-day EMA is back close to 1433.
  • Upside pressures may be limited by National Pension Service hedging, but spillover risks from higher USD/CNY levels (of we see early US tariff/trade action from the new US administration) is still a risk for the rest of Jan/early Feb. Won has outperformed Asian FX in the past week, up over 1%.
  • In the cross asset space, local equities are weaker today, but the Kospi is holding above 2500. Offshore investors have sold -$280mn of local shares today, for modest outflows this past week.
  • Looking at the data calendar for next week, we have PPI, along with the first 20days of trade data on Tuesday. Consumer confidence on Wednesday, then business sentiment and Q4 GDP on Thursday. 
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Spot USD/KRW has maintained recent ranges in the first part of Friday dealing. We were last near 1456, slightly stronger in won terms for the session. Lows this week came after the surprise BoK hold, but the pair bottomed out just under 1450, with BoK board members still strongly in favor of another cut in the next 3 months. Governor Rhee also highlighted downside economic risks. 

  • Spot USD/KRW has tested 20-day EMA downside support a number of times this month. This support level is near current spot levels (1355). A fresh break lower may see early Jan lows, just under 1445 targeted. The 50-day EMA is back close to 1433.
  • Upside pressures may be limited by National Pension Service hedging, but spillover risks from higher USD/CNY levels (of we see early US tariff/trade action from the new US administration) is still a risk for the rest of Jan/early Feb. Won has outperformed Asian FX in the past week, up over 1%.
  • In the cross asset space, local equities are weaker today, but the Kospi is holding above 2500. Offshore investors have sold -$280mn of local shares today, for modest outflows this past week.
  • Looking at the data calendar for next week, we have PPI, along with the first 20days of trade data on Tuesday. Consumer confidence on Wednesday, then business sentiment and Q4 GDP on Thursday.