USD/KRW rises to six-month high as coronavirus spreads into South Korea

USD/KRW remains 0.67% up to 1,217.50 by the press time of early Monday. In doing so, the pair stays near the highest levels last seen during the late-August 2019 and the reason to blame is the outbreak of coronavirus (COVID-19) in South Korea.

As per the latest updates from Yonhap, South Korea reported the seventh death due to coronavirus that has already infected 161 people by Monday and took the toll to 763 so far.

The fears of coronavirus spread outside China recently gained momentum after rising numbers from Italy, South Korea, Japan and Hong Kong crossed the wires during the weekend.

While identifying the fears of the epidemic, South Korea’s Finance Ministry earlier said that the COVID-19 threatens to limit the Korean economic recovery. However, diplomats including that from the ruling party also showed readiness to counter the epidemic by calling more than 10 trillion won on additional budget.

From China, the latest numbers are slightly positive with the news of multiple provinces lowering coronavirus emergency response levels. However, the market’s risk aversion fails to recover. While portraying the risk-off, S&P 500 Futures drop 1.9% while South Korea’s KOSPI loses 2.88% to 2,100 by the press time.

Markets are all ears to coronavirus updates amid a lack of major data/events on the economic calendar as well as off in Japan.

Technical Analysis

Buyers are now targeting August 2019 high near 1,2230 while October 2019 top near 1,208 and 1,200 round-figure can act as the immediate supports during the pair’s pullback.