South Korean Won: Energy shock drives sharp depreciation – BBH
Brown Brothers Harriman’s (BBH) Elias Haddad highlights that the Korean Won is underperforming, with USD/KRW surging to its highest level since 2009. Haddad attributes the weakness to South Korea’s negative net energy balance and negative real rates, and while authorities vow to curb excessive FX moves, intervention is seen as only slowing, not reversing, KRW depreciation during the ongoing energy shock.
Authorities struggle against weak Won
"KRW is underperforming across the board, with USD/KRW surging to 1540.55, the highest level since March 2009."
"The slide in KRW largely reflects South Korea’s negative net energy balance and negative real rates."
"South Korea vowed again today to curb excessive one-sided FX move."
"However, until the energy shock fades, FX intervention is more likely to slow KRW depreciation than unwind its massive undervaluation."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Is a major reversal in stock-bond allocation approaching? Bank of America issues rare signal: Bonds compete with stocks for capital for the first time in decades, S&P 500's return over the next ten years may be less than 5%
Savita Subramanian, Head of US Equity and Quantitative Strategy at Bank of America, said in an interview on Wednesday that the bond market is becoming attractive again and has, for the first time in decades, become a real competitor to the stock market.
Stop Using the Consumer Cycle to Analyze Micron (MU.US)! AI is Redefining NAND Logic, Enterprise SSDs Have Taken Over Pricing Power
Eudaemon Research previously assessed that within Micron's business structure, DRAM is more resilient than NAND, and that NAND prices and demand would return to normal faster. However, Micron's latest Q4 financial data has led them to revise this view: NAND is no longer a homogeneous market, and the supply-demand and pricing dynamics of consumer-grade NAND and enterprise-level data center SSDs are clearly diverging.
Micron's target price is significantly raised by investment banks, with a maximum of 3,000 USD
DA Davidson has raised Micron's target price to $3,000, implying a 176% upside from the current share price. The core logic is that the AI-driven memory supercycle will continue until 2028, with the supply-demand gap widening further. The key variable lies in the shift of demand—buyers are transitioning from smaller, high-default-risk clients to tech giants such as Amazon, Microsoft, and Google. Micron has already secured $150 billion in remaining contractual obligations.
Oil prices continue to surge, triggering inflation concerns; global stock markets under pressure, Korean stocks close down 2.6%, US Treasury yields rise
Brent crude oil rose about 2.5% on Thursday, surpassing the $102 per barrel mark. Driven by this surge, the U.S. 10-year Treasury yield climbed 3 basis points to 5.31%, approaching its highest level since 2002. Asian stock markets followed the downward trend of U.S. stocks on Wednesday, with an overall decline of 1.2%. Japan's Nikkei 225 closed down 1.4%, and South Korea's Seoul Composite Index plunged 2.6%.
Crypto prices
More
