The Korean won rallied 8% at the opening after the government agreed to backstop the banks. The stronger won is helping lessen risk aversion, pushing up EUR/JPY. An early rally in the Nikkei is helping as well. It was last up about 0,8%. EUR/USD is up at 1.3445, USD/JPY at 101.63 and EUR/JPY at 136.66.
One important upshot of the stronger KRW is diminished need for the BOK to intervene to support the won and then turn around and sell EUR/USD to keep its reserve mix in balance. Korean sales have been a factor for the last two or three months as they desperately tried to defend the week domestic currency.
