USD/KRW to reach 1,285 by 1Q2024 and 1,235 by end-2024 – MUFG

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28 December 2023

USD/KRW to reach 1,285 by 1Q2024 and 1,235 by end-2024 – MUFG

Economists at MUFG Bank expect Asian currencies to appreciate against the Dollar in 2024 with the Korean Won being the front-runner.

A recovery global semiconductor industry is positive for KRW

KRW is set to be front runner among its Asian peers.

A recovery global semiconductor industry and continued favourable AI trend and electronic cycle would stimulate Korea’s exports and improve trade balance.

South Korea likely benefit from China’s more balanced recovery next year and deliver a positive growth of exports to China in 2024.

Additionally, due to the Fed’s policy rate cutting, the negative yield spread between South Korea and the US likely turns positive in 2H2024, providing another layer of support for KRW.

We forecast USD/KRW to reach 1,285 by 1Q2024 and 1,235 by end-2024.

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