Most Asian currencies subdued heading towards year-end; South Korean markets rise

Most Asian currencies were subdued on Monday, pressured by high US Treasury yields and a firm dollar, while South Korean markets recovered slightly after last week’s parliament vote to impeach acting president Han Duck-soo.

Equities in the region edged higher, with stocks in Malaysia and Singapore each gaining 0.3%.

The South Korean won rose 0.2% after falling to a more than 15-year low on Friday, following Han’s impeachment. Equities climbed 0.4% after Friday’s fall of about 1%.

“The political uncertainties and faster rate cut pace should keep the won on the back foot in the coming months,” said Ken Cheung, chief Asia FX strategist at Mizuho Bank.

The won is the worst performing currency in emerging Asia so far this year, having lost some 12% amid political turmoil, weak exports, fears of US tariffs and an unexpected rate cut from the Bank of Korea.

The country’s factory output fell more sharply than expected in November amid slowing exports and weakening business confidence, data showed on Monday.

Most other Asian currencies were largely unchanged amid pressure from high US Treasury yields and with the dollar at a multimonth peak.

Asian currencies: S Korean won at 16-year low

Yields on 10-year Treasuries are near eight-month highs at 4.631% and ending the year around 75 basis points above where they started it, despite the Fed making 100 basis points of cuts to cash rates.

The Federal Reserve’s hawkish tilt at its December policy meeting has weighed on Asian currencies, which were already under pressure from fears of US tariffs in 2025.

The Indonesian rupiah rose 0.5% on Monday. The Thai baht climbed 0.3% while equities gained 0.4%.

Thailand will implement a global minimum corporate tax of 15% on multinational enterprises from the beginning of January, the finance ministry said on Friday.

Mizuho’s Cheung said the move should be supportive of the baht over the medium term, as it signals a step towards joining the Organisation for Economic Cooperation and Development (OECD).