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USDKRW is back above 1140, currently.....>

KOREAN WON
KOREAN WON: USDKRW is back above 1140, currently trading at 1141.4 as the Kospi
trades at fresh multi-year lows below 2000. 
- Given the intense weakness seen in the Kospi, which is down 15% in October
alone, the won is holding up relatively well. 
- One explanation is that unlike previous sharp drops in Korean stocks, the
latest episode has failed to trigger a rise in default risk, with CDS spreads
remaining near cycle lows, reflecting the improvement seen in Korea's external
balance sheet over recent years.
- However, the more equities come under pressure, the more rate markets will
price out BOK hikes. 2-year swaps are down 9bps today to 12-month lows at 1.80%,
sending US-Korea spreads to fresh cycle highs. 

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