{"id":15406,"date":"2024-10-18T02:35:42","date_gmt":"2024-10-18T02:35:42","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=15406"},"modified":"2024-10-18T02:35:42","modified_gmt":"2024-10-18T02:35:42","slug":"usd-krw-dips-on-china-stimulus-disappointment","status":"publish","type":"post","link":"https:\/\/www.global-vtrader.com\/en\/analysis\/usd-krw-dips-on-china-stimulus-disappointment\/","title":{"rendered":"USD\/KRW Dips on China Stimulus Disappointment"},"content":{"rendered":"\n<p>The USD\/KRW has dipped 0.1% to 1,371.15, continuing its recent downward trajectory as foreign investors reduce their exposure to South Korean equities.<\/p>\n\n\n\n<p>The decline suggests that traders are betting on a continued cautious stance from the Bank of Korea.<\/p>\n\n\n\n<p>With no immediate signs of intervention, the won is vulnerable to further downside pressure, especially if China\u2019s recovery falters.<\/p>\n\n\n\n<p>On the other hand, any concrete, more substantial stimulus from China could bolster the won and reverse the outflows.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/wp-content\/uploads\/2024\/10\/image-34-1024x440.jpeg\" alt=\"\" class=\"wp-image-15407\" style=\"width:1450px;height:auto\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center\"><em>Picture: USD\/KRW climbs to 1368.15, with bullish momentum slowing as traders watch for resistance near 1371.41 as seen on the <a href=\"https:\/\/vtmarketsapp.onelink.me\/CD7D\/240525WA%20%E2%80%8EVT%20Markets-Online%20Trading%20%E2%80%8ETrade%20anytime,%20anywhere%20now%20with%20VT%20Markets%20%E2%80%93%20a%20Global-recognized%20CFD%20broker!%20The%20VT%20Markets%20App%20gives%20you%20on-the-go%20access%20to%201000+%20tradable%20assets%20contracts-for-differences%20(CFDs)%20including%20Fore...\" title=\"\">VT Markets app.<\/a><\/em><\/p>\n\n\n\n<p>The USD\/KRW closed at <strong>1368.15<\/strong>, reflecting a <strong>0.44%<\/strong> increase during the session, with price action fluctuating between a low of <strong>1362.2<\/strong> and a high of <strong>1370.29<\/strong>.<\/p>\n\n\n\n<p>The moving averages (5, 10, and 30-period) indicate a short-term bullish trend, with prices trading above these averages for most of the session.<\/p>\n\n\n\n<p>However, the <strong>MACD<\/strong> shows bearish divergence as the MACD line dips below the signal line, with negative histogram bars expanding. This suggests that the pair may face a potential pullback in the near term.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Dollar Strength Holds Firm<\/h2>\n\n\n\n<p>USD\/KRW&#8217;s movement has been largely influenced by global risk sentiment and dollar strength.<\/p>\n\n\n\n<p>Recently, the US dollar has benefited from strong US economic data and Federal Reserve signals hinting at a more cautious approach to rate cuts, supporting the dollar against risk-sensitive currencies like the Korean won.<\/p>\n\n\n\n<p>On the other hand, geopolitical tensions in Asia, particularly involving China, could also play a role in the won&#8217;s weakness.<\/p>\n\n\n\n<p><strong>See also: <a href=\"https:\/\/www.vtmarkets.com\/analysis\/dollar-lifts-asia-awaits-china-housing-policy\/\">Dollar Lifts, Asia Awaits China Housing Policy<\/a><\/strong><\/p>\n\n\n\n<p>Additionally, South Korea&#8217;s latest export data reflects challenges as global demand slows, further pressuring the won.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">China Stimulus on the Rocks<\/h2>\n\n\n\n<p>This shift in sentiment follows disappointment over China\u2019s stimulus measures, which have failed to lift market confidence.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">What Really Happened With The Chinese Stimulus <a href=\"https:\/\/t.co\/TaD22tkg0c\">https:\/\/t.co\/TaD22tkg0c<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/1846984441836519902?ref_src=twsrc%5Etfw\">October 17, 2024<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>South Korean traders are becoming increasingly sensitive to <strong><a href=\"https:\/\/www.bloomberg.com\/news\/live-blog\/2024-10-18\/china-gdp-key-economic-indicators?utm_medium=social&amp;utm_campaign=socialflow-organic&amp;utm_source=twitter&amp;cmpid=socialflow-twitter-business&amp;utm_content=business\">China\u2019s economic decisions<\/a><\/strong> due to the country\u2019s close trading ties and reliance on Chinese demand for exports, especially in key industries such as semiconductors and shipbuilding.<\/p>\n\n\n\n<p>The broader picture reveals a softening Korean won amid these concerns, with foreign outflows accelerating as traders look for safer havens.<\/p>\n\n\n\n<p>The weakness in the Korean won reflects market caution over whether China\u2019s property sector support will be sufficient to revive its economy.<\/p>\n\n\n\n<p>This raises concerns about demand for South Korean exports, which are heavily tied to Chinese growth. The outflows from South Korean stocks, particularly in sectors like <strong><a href=\"https:\/\/t.co\/xwVs6gihBR\">technology<\/a><\/strong> and heavy industry, further weigh on the currency.<\/p>\n\n\n\n<p>We expect continued volatility in the pair as market participants keep a close eye on developments in China and any shifts in risk sentiment globally.<\/p>\n\n\n\n<p>If China\u2019s economic revival shows real signs of traction, we may see some relief for the won. However, for now, the pressure remains on the downside for the South Korean currency.<\/p>\n\n\n\n<p><strong>Start trading now \u2014 click\u00a0<\/strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/?utm_campaign=account_c&amp;utm_source=dma&amp;utm_medium=website\"><strong>here<\/strong><\/a><strong>\u00a0to create your live VT Markets account.<\/strong><a href=\"https:\/\/www.vtmarkets.com\/#facebook\" target=\"_blank\" rel=\"noreferrer noopener\"><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>USD\/KRW dips as foreign outflows rise, driven by disappointment in China\u2019s stimulus and concerns over South Korean exports. &#8211; vtmarkets.com <\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[27],"tags":[28,12,51],"class_list":["post-15406","post","type-post","status-publish","format-standard","hentry","category-analysis","tag-dollar","tag-forex","tag-won"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/15406","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/comments?post=15406"}],"version-history":[{"count":0,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/15406\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/media?parent=15406"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/categories?post=15406"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/tags?post=15406"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}