USDKRW is trading just below 1140........>

KOREAN WON: USDKRW is trading just below 1140 after opening above this level

amid broad-based risk-off sentiment which has seen the Kospi drop 2%.

Considering the weakness in stocks, the won is holding up relatively well for

now, but risks are rising. 

- While real yield spreads have edged in the won's favour over recent days

thanks to the drop in US yields, the positive impact on the won has been more

than offset by rising credit spreads as Korean CDS spreads have risen in line

with global equity weakness. 

- Weak real GDP data has also not helped Korean assets, with the Q3 preliminary

growth rate coming in below expectations at 2.0%, reducing the potential for a

BOK rate hike in November.