FX volatility likely to ease if Middle East tensions subside: banks

Officials from major global investment banks and local lenders said Tuesday volatility in the Korean foreign exchange (FX) market is expected to ease when tensions in the Middle East subside given the country's solid economic fundamentals and stable foreign currency liquidity, according to the finance ministry. The assessment was made during a meeting between the Ministry of Finance and Economy and officials from Goldman Sachs, Barclays, Deutsche Bank, BNP Paribas, Hana Bank and KB Kookmin Bank to discuss the impact of the conflict involving Iran on financial and FX markets. The market participants noted that the FX market has experienced increased volatility due to external factors, though Korea's economic fundamentals remain solid, citing strong export performance and sound external stability. They also said the country's foreign currency liquidity remains stable, and exchange rate volatility is likely to ease quickly if Middle East tensions abate, according to the ministry. The Korean won has remained below the psychologically important 1,500-won level in recent sessions, as the confl

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