USD/KRW Price Analysis: South Korean won rallies hard despite uptick in jobless rate
- USD/KRW corrects sharply from eight-day highs.
- Broad dollar weakness – the main catalyst behind the fall.
- South Korea’s unemployment rate arrived at 3.8% vs 3.3% previous.
USD/KRW has stalled its corrective slide and looks to extend the recovery momentum above 1,220 levels so far this Friday’s Asian trading. Despite, the latest bounce, the spot sheds 0.75% to currently trade at 1,219.60.
South Korean won rallied hard vs. the greenback in early Asia despite a sharp uptick in the country’s Unemployment Rate for March, which fully reflected the coronavirus impact on the economy.
The cross fell as low as 1,216.83, with the declines mainly fuelled by broad-based US dollar correction from a five-day high of 100.29. A turnaround in the risk sentiment amid signs of likely economic upturn, as US President Trump announced a three-phase plan to re-open the 29 states as soon as Friday.
Further, a 5.2 million surge in the US Jobless Claims also collaborated with the bearish reversal in the US currency across the board.
Meanwhile, the Asian currency failed to take advantage of the recent positive political development while the additional fiscal stimulus plan to fight the coronavirus crisis was also ignored by the KRW bulls.
South Korea held its parliamentary elections on Wednesday which saw the ruling Democratic Party of President Moon Jae-in winning a resounding victory. Meanwhile, the Finance Ministry announced a proposed second supplementary worth 7.6 trillion won ($6.2 billion) to fund cash handouts on Thursday.
South Korean won: Levels to watch
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
