If the environment of competitions between USD and EM currencies like in 2013 depending on QE tapering in US, KRW would lose against USD under the woes about Chinese slowdown risks.
However, I don't think so. Because I focus on the worsening economic indicators in US as well. Actually, I've predicted US economy could pose to a downside risk because of 1) too rapid pace of stocking inventories in last 3 quarters compared with last 10 years, 2) labor market slack seen from Beveridge curve, increasing concerns about restrict income and consumption, and 3) decreased pending home sales for 4 consecutive months, for 2 consecutive months at that time that is a leading indicator of the housing demand.
Although some economists argued that recent weak data is on the harsh weather conditions, I think this effect is not entirely but referred factors combine with it as Yellen refered yesterday.
If US economy is worse than expectation, governors should use monetary policy toward easing finally. And when global money seek the safe assets, KRW would be one of them, I expext.
Since global financial crisis in 2008, the essential conditions for global safe assets became both of sustainable government debt to GDP and current account surplus. And KRW is sufficient for these two conditions.
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