South Korea to open FX market around the clock, in bid for MSCI upgrade

Core Viewpoint - South Korea plans to open its currency market for 24-hour trading starting in July, aiming to enhance the accessibility of the won and secure an upgrade to developed-market status [1][3]. Group 1: Currency Market Changes - The new 24-hour trading initiative follows a previous extension of trading hours that allowed foreign entities to trade the won from abroad, which was implemented two years ago [4]. - The current dollar-won market was previously limited to six-and-a-half hours of trading per day, with direct dollar transactions restricted to two domestic interbank networks [4]. - The finance ministry will introduce a new system for offshore won trading, ease reporting requirements, and simplify the registration process for market participation [5]. Group 2: Economic Policy and Market Status - Achieving developed market status is a key policy goal for President Lee Jae Myung, who has implemented market reforms and tax measures to stimulate the domestic stock market since taking office in June 2025 [6]. - The KOSPI stock benchmark experienced a significant rise of 76% last year, marking its strongest performance since 1999, driven by these policy initiatives [6]. Group 3: Economic Forecast - The finance ministry forecasts that South Korea's trade-reliant economy will grow by 2.0% in 2026, an increase from the previously estimated 1.8%, supported by improving domestic demand and strong exports [8]. - Inflation is projected to remain stable at 2.1% in 2026, consistent with the rate in 2025 [8].