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].

Core Points - The trade pact between the U.S. and South Korea is expected to lead to significant capital outflows from South Korea, potentially impacting the won negatively while benefiting the Kospi index [1][2] - South Korea has committed to invest $350 billion in the U.S., with $200 billion in cash to be paid in installments capped at $20 billion per year, and $150 billion allocated for shipbuilding cooperation [2] - The investments will be funded through operating income from South Korea's foreign assets, but managing the capital outflows will be crucial for the stability of the won [3][4] Currency Impact - The Korean won is anticipated to face depreciation risks due to steady long-term capital outflows, which may limit short-term gains [4][6] - The won has been one of the worst-performing currencies in Asia, influenced by local investors' increasing interest in U.S. stocks [5] - Citigroup forecasts that the won could weaken further to 1,450 per dollar over the next six months to a year [5] Economic Context - The deal is seen as favorable for South Korea, alleviating uncertainties regarding investment financing, but the long-term outflows need to be considered [4] - The potential for lower conversion of dollar export proceeds to the won may exacerbate depreciation risks in the coming years [6]

Group 1 - South Korea's president announced plans to open the currency market for around-the-clock trading to enhance foreign investor access and boost the domestic stock market [1][2] - The government aims to address the lack of an offshore won market, which has contributed to South Korea's classification as an emerging market by MSCI [2] - The onshore currency market is gradually being opened to foreigners, with new trading hours extending from 9 a.m. local time to 2 a.m. the next day [3][4] Group 2 - The president's comments come amid stalled U.S. trade talks regarding a $350 billion investment package, raising concerns about potential foreign exchange crises [5][6] - The won has weakened significantly, reaching its lowest level since mid-May at 1,414.0 per dollar, indicating market caution regarding intervention [6][7]