GLOBAL ECONOMY

US Inflation Re-ignites at 4.2% & Launch of Warsh Fed: South Korea's Economy Navigates Dual Turbulence of High Exchange Rates and High Oil Prices

With the concurrent convergence of three variables—re-igniting inflation, robust employment, and new Federal Reserve leadership—the South Korean economy faces dual pressures of a won-dollar exchange rate soaring to the mid-1,500 KRW range and high oil prices hovering around $90 per barrel. If shocks originating from energy spill over into services and wages, pushing core inflation upward, the prolonged period of high U.S. interest rates will become a fait accompli, potentially extending the upward pressure on the strong dollar.