Korean Won topples amidst regional tension

Aug 9 (Reuters) – Most Asian currencies stumbled on Wednesday with the Korean won destined for its biggest fall in nearly eight weeks as North Korea warned it is “carefully examining” plans for a missile strike on the U.S. Pacific territory of Guam.

The won was trading down 0.6 percent at 1134.8 at 0556 gmt. KRW=

North Korea’s reference to an attack on Guam followed

after President Donald Trump said the U.S. would respond to threats from North Korea with “fire and fury”.

“We have been down this road before, until the fireworks happen it will remain in the headlines, but in the past the markets have faded these types of moves. I think we have to be really sensitive to both liquidity conditions and further headline risk over the next 24 hours,” said Stephen Innes, Head of Trading APAC  at OANDA.

“China basically buttresses the North Korea economy from top to bottom. We are going to have international pressures from the U.S. and all the developed-world leaders who see this escalating a bit too far. I think there is going to be pressure on China to make some serious economic sanctions towards North Korea until they give up the plot of military escalation.”

The Edge Markets via Reuters

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes