S Korean won is proxy for Asia
The currency is most liquid among Asian emerging markets and reflects the health of Asian trade
For investors looking to bet on Asia as the region awaits clarity on US policies, South Korea’s currency may provide the best proxy, reports Bloomberg.
“The won is very sensitive to political uncertainties in the US, and in particular now, in the run-up to the US fiscal policies to be announced by Trump in the coming weeks,” said Yann Quelenn, of Swissquote Bank SA.
“The Korean won is the most-liquid currency in Asia’s EM,” Bloomberg quoted Khoon Goh, head of Asia research at Australia & New Zealand Banking Group as saying. “It has a deeper and more advanced financial market.”
Foreign-exchange strategist at top ranked emerging Asia currency forecaster Standard Chartered, Eddie Cheung says the won reflects the health of Asian trade.
“There are a lot of multinationals or corporates there that are externally oriented,” said Cheung. “The Korea trade numbers are a good indicator of where Asian trade is going in general.”