[환율전망] US CPI below expectations vs concerns over economic recession… A rebound after a downturn

On the 13th, the won-dollar exchange rate is expected to start declining.

As the US consumer price index (CPI) fell below market expectations in March, the US dollar weakened as awareness of the Fed’s final stage of tightening strengthened.

However, some predict that it will rebound to the upper half of 1,320 won due to sluggish risk appetite due to concerns about the economic recession.

Kim Yu-mi, a researcher at Kiwoom Securities, said, “The NDF dollar/won exchange rate for one-month contracts is expected to drop 6 won to 1320.97 won, but further decline is likely to be limited due to the decline in the New York stock market and sluggish demand.”

In the US, consumer prices rose 5.0% year-on-year in March, falling short of both the market expectation (5.1%) and the previous month’s figure (6.0%).

Researcher Kim analyzed, “As core inflation rose slightly to 5.6% year-on-year, the inflation boundary was not completely resolved, but the dollar fell as the perception that the Fed’s tightening was nearing completion strengthened.”

“However, further decline in the dollar was limited as the possibility of an economic recession was raised in the FOMC minutes,” he added.

Min Kyung-won, a researcher at Woori Bank, said, “Today, the dollar/won started to decline due to the weak dollar, and the risk appetite slowed, and low-priced purchases in and outside the region were

We expect a resistance test in the mid-1320 won range in the mouth,” he said.

He said, “Overnight, the US headline consumer price index supported the expectation of a total of two cuts within the year as the increase compared to the previous month was slower than expected.”

It is highly likely that they will show interlocking movements.”

“As a result, foreign funds in the domestic stock market will be converted to net selling in pursuit of the decline in growth stocks, and we expect it to stimulate the recovery of long sentiment offshore, which broke through the early 1320 won yesterday,” he said.

Researcher Min said, “After today’s decline, it is expected that the stock market will attempt to enter the upper half of 1,320 won by rebounding on foreign net selling and inflow of domestic and foreign buying.”