Here’s this week’s forecast for the Korean won-US dollar exchange rate from Hana Bank.
The weekly forecast is neither a guarantee nor a promise of accuracy and is intended to give our readers information on the forecasted foreign exchange rate from the bank each week.
Check out the most up-to-date foreign currency exchange rates for over 40 currencies here.
Trading range: 1,280 – 1,300 KRW per 1 USD
This week’s forecast:
The KRW-USD rate will continue to face upward pressure from the Fed’s more aggressive monetary tightening. Fed Chair Jerome Powell who is expected to testify before Congress will reaffirm the central bank’s resolve to tame inflation. Under such conditions, the probability of a 75bp rate rise will help the greenback remain strong.
Yet, predictions that the Bank of Korea will take a ‘big step’ rate hike will limit any sharp rise in the KRW-USD rate.
Also, the rate’s growth pace will slow due to Korean authorities possible intervention around 1,300 won.
Last week’s trend:
In reaction to a strong dollar trend prompted by the U.S. inflation shock(8.6% yoy), the Korean won-U.S. dollar (KRW-USD) exchange rate opened the week up. It then continued to rise on news that the Federal Reserve was considering taking its most aggressive step yet to fight inflation.
Around mid-week, with hopes for peak inflation dashed, it was widely believed that the Fed would hike rates by 75bp and as a result, the greenback rose at a faster rate.
Following the Fed’s 75bp increase, the KRW-USD rate turned lower as the US dollar erased some of its earlier gains due to a somewhat dovish statement from the Fed. Later in the week, as recession fears made the global financial market more volatile, investors turned risk-averse and the KRW-USD rate ended the week with a loss.
Disclaimer: Neither Hana Bank nor Haps Korea shall accept any liability for any damage or loss, including but not limited to profit or loss, that may arise either directly or indirectly from use of this information.