ING’s Min Joo Kang notes that KRW is trading below 1,500 and short-term movements are highly dependent on developments in the Middle East. The team maintains a trading range of 1450-1550, expecting KRW to strengthen quickly once the war ends. They argue that the KRW’s recent weakness is mainly due to profit-taking from foreign stocks, and that attractive valuations of Korean stocks are helping to stabilize the currency.

War Risk and Stocks Drive Won’s Forecast

“KRW is currently trading below the 1500 level. The short-term move will largely depend on the situation in the Middle East. Therefore, we continue to maintain our trading range at 1450-1550 for now.”

“We agree with Governor Rhee’s view: if the war ends, the KRW is expected to strengthen quite quickly. The recent weak KRW was mainly due to net selling of shares by foreign investors – probably a profit motive rather than panic selling.”

“The continued attractive valuation levels in the Korean stock market are expected to help stabilize KRW.”

(This article was created with the aid of an artificial intelligence tool and has been reviewed by an editor.)