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(Seoul=Yonhap Infomax) Seon Mi Jeong – Foreign exchange (FX) swap points were largely flat on Tuesday, with only the one-year tenor posting a modest gain amid growing expectations for a US Federal Reserve rate cut in December.
In the offshore FX funding market on the 25th, the one-year FX swap point closed at -20.90 won, up 0.10 won from the previous session. This marks a 0.20 won increase from the opening level of -21.10 won.
The six-month tenor slipped 0.10 won to -12.60 won, unchanged from its opening price. The three-month swap point edged up 0.05 won to -6.65 won, also matching its opening level. The one-month tenor fell 0.20 won to -2.35 won, remaining flat from the open.
In the ultra-short term, the overnight swap point was quoted at -0.08 won, while the tomorrow-and-next (T/N) was at -0.14 won.
According to federal funds (FF) rate futures, the probability of a US Federal Reserve rate cut in December has climbed to 81.1%.
“There wasn’t much movement overall, and some asset swaps were seen,” said a foreign exchange dealer at a local bank. “It doesn’t seem like the market has fully priced in the December US rate cut outlook yet.”
Another FX dealer at a different bank noted, “It looked like swap points would rise, but they slipped back at the close. There was some buy-sell activity related to overseas investments by insurance companies, but the volume was not significant.”
smjeong@yna.co.kr
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