Trump–Korea trade deal seen lifting Kospi but pressuring won
President Donald Trump’s new trade pact with South Korea is expected to boost Korean equities while adding pressure on the won as capital flows shift toward the U.S. under the agreement.
Info comes via Reuters, in brief:
The deal, which cuts U.S. tariffs on Korean cars and auto parts to 15% from 25%, includes $350 billion in new Korean investments in the U.S., split between $200 billion in phased cash outflows and $150 billion in shipbuilding cooperation. Economists said the outflows could tighten local liquidity and weaken the won, which has already been one of Asia’s poorest performers this year.
Citigroup expects the currency to fall toward ₩1,450 per dollar over the next year as pension funds and corporates continue building U.S. exposure.
Still, markets welcomed the deal’s clarity: the Kospi hit fresh record highs, led by gains in autos, shipbuilders, and chipmakers. Analysts at Morgan Stanley and J.P. Morgan said reduced tariff uncertainty could drive the index above 5,000 points over the coming year.
