금융시장
Foreign Exchange Rate Forecast for 2010 2H
2010-10-07SONG, Kyoung-Hee
목차
요약
With US dollar risks caused by US economic slowdown and double deficit, weak dollar will continue
Although global economy inevitably slows down in 2H, a serious double dip recession will be avoidable. Financial instability is occasionally expected, but extreme preference for safety will not be dominant in the market.
As such circumstances make dollar less attractive as a safe asset, dollar risks like large scale twin deficit as well as economic slowdown will arise, making dollar weak.
Dollar/euro exchange rate is expected to increase to 1.30 dollars per euro because the existing crisis in the euro zone has been significantly reflected already and benefits of weak dollar are expected.
As appreciation pressure will be put on the yen due to Japan's current account surplus with few possibilities of carry trade recovery, yen/dollar exchange rate will continue to be decrease. However, it is expected to early eighties yen per dollar considering Japanese government's possible intervention.
As the yuan started to appreciate since China dropped dollar peg this June, yuan/dollar exchange rate is expected to increase about 3% this year based on the past experiences or real effective exchange rate.
Won/dollar exchange rate is expected to continue to slowly drop due to favorable fundamentals amid weak dollar
Amid continued weakness of the US dollar, foreign investment funds flow into Korea considering the nation's favorable fundamentals including fiscal soundness and additional interest rate increase, and exchange rate will slowly decrease.
However, the decrease rate is expected to be gradual due to the government's exchange rate management policy. Exchange rate volatility will be significantly high due to global economic slowdown and effects of financial market instability (won/dollar exchange rate expected to be at 1,110~1,200 won per dollar in 2H).
Although global economy inevitably slows down in 2H, a serious double dip recession will be avoidable. Financial instability is occasionally expected, but extreme preference for safety will not be dominant in the market.
As such circumstances make dollar less attractive as a safe asset, dollar risks like large scale twin deficit as well as economic slowdown will arise, making dollar weak.
Dollar/euro exchange rate is expected to increase to 1.30 dollars per euro because the existing crisis in the euro zone has been significantly reflected already and benefits of weak dollar are expected.
As appreciation pressure will be put on the yen due to Japan's current account surplus with few possibilities of carry trade recovery, yen/dollar exchange rate will continue to be decrease. However, it is expected to early eighties yen per dollar considering Japanese government's possible intervention.
As the yuan started to appreciate since China dropped dollar peg this June, yuan/dollar exchange rate is expected to increase about 3% this year based on the past experiences or real effective exchange rate.
Won/dollar exchange rate is expected to continue to slowly drop due to favorable fundamentals amid weak dollar
Amid continued weakness of the US dollar, foreign investment funds flow into Korea considering the nation's favorable fundamentals including fiscal soundness and additional interest rate increase, and exchange rate will slowly decrease.
However, the decrease rate is expected to be gradual due to the government's exchange rate management policy. Exchange rate volatility will be significantly high due to global economic slowdown and effects of financial market instability (won/dollar exchange rate expected to be at 1,110~1,200 won per dollar in 2H).
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