TSX gains after CPI shows US inflation rose 3%
Investing.com -- The South Korean won is forecast to strengthen to 1,340 against the U.S. dollar by the end of 2025, according to Bank of America strategist Chun Him Cheung.
In a note, Cheung attributed the expected appreciation to increasing foreign equity inflows and anticipated dollar weakness following Federal Reserve rate cuts.
The USD/KRW has underperformed the dollar index since early August, with the won facing pressure from substantial outflows from the National Pension Service and retail investors.
Despite these challenges, equity inflows into South Korea are increasing, driven by the president’s market reforms and a recovery in the electronics sector.
A key risk to this outlook involves the financing details of the tariff investment deal with the United States. The U.S. is seeking the majority of the promised $350 billion in the form of direct foreign direct investment, while Seoul prefers to use policy-finance loans and guarantees.
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