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Won strengthens as foreign inflows support USD/KRW in mid-1380s
USD/KRW slid into the mid-1380s as foreign investors reportedly bought Korean equities on the selloff, though the strategist flagged tech volatility and a less undervalued won as risks.
DBS strategist Chang Wei Liang said South Korean won strength has resumed, with USD/KRW falling to the mid-1380s even as the KOSPI dropped nearly 6% on semiconductor-led losses, according to FXStreet.
The strategist attributed the FX move to foreign investors using the equity correction to add Korean stocks, funding those purchases via USD selling, while warning that volatility in tech names and a won that is no longer as undervalued could temper the outlook.
FXStreet also noted broader market context, including the US Dollar bouncing modestly and investors looking ahead to key UK data, as well as a stabilization in US Treasury yields after a sharp move earlier in the week.
In rates, the US Treasury’s plan to at least double liquidity support buyback operations in the 10-year to 20-year and 20-year to 30-year sectors, raising the maximum from $2 billion per operation to at least $4 billion, was cited as a factor that helped ease the recent surge in yields.
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