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USD/KRW slides toward 1340, but DBS flags room for gains

DBS expects further KRW strength to be more limited after undervaluation has largely closed and the National Pension Service suspended FX hedging.

Reported · Written up by our desk · Major Pairs

FXStreet, citing research from DBS Group Research, said USD/KRW has been in a steady decline since late June, moving toward the 1340 area.

DBS analyst Chang Wei Liang links the earlier Korean won optimism to a booming memory sector and strong investment plans.

The note, however, warns that additional KRW gains may be capped as the market has largely worked through undervaluation and as the National Pension Service suspends FX hedging.

DBS expects the pace of KRW appreciation to moderate rather than accelerate from here, according to the FXStreet write-up.

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