USDKRW is an exotic Forex pair. However, it is very popular among traders, as it includes the currencies of two strong world economies, the US and South Korea, and its rate is quite easy to predict.
US Dollar is the national currency of the United States of America. The issuer of the USD is the Federal Reserve System (the Fed).
The USD exchange rate depends on the US macroeconomic indicators and the Fed's monetary policy. Trading USD speculators need to monitor interest rate changes, GDP dynamics, and inflation and non-farm employment rates. As a rule, if the Fed raises the interest rate and the inflation rate does not exceed 2%, the USD rate rises.
Import and export volumes also affect the US dollar exchange rate. So, with an increase in imports, the value of the USD will decrease.
The South Korean Won (KRW) is the currency of South Korea. The country is a world leader in the construction of ships and offshore platforms and one of the largest manufacturers of vehicles and high-tech products. Due to these factors, the won's value directly depends on the export of these goods. For example, in 2019, due to the US-China trade conflict, the volume of supplies from South Korea decreased, and the won rate seriously declined.
The value of KRW is also affected by the amount of investment in the Korean economy, as well as the cost of commodities. During periods of economic uncertainty, investors prefer to invest in reliable defensive assets, such as the US dollar. As a result, capital flows from Asian markets.
For USDKRW trading, it is important to keep a close eye on news releases. Due to the escalation of trade wars between the US and China, Korean exports could be seriously affected, the won will fall in value, and the currency pair will appreciate.
Since the trading times for the US dollar and the South Korean won do not overlap, it is best to trade USDKRW during the Asian trading session from 03:00 to 11:00 and the American trading session from 15:00 to 00:00 (GMT+3, indicated in the LiteFinance trading platform).
Risk warning: Trading in FX and CFDs entails high risk of losing capital.
