While we await Donald Trump’s response to the second consecutive North Korean provocation in four days, both on twitter and elsewhere, South Korean President Moon Jae-in has already ordered his troops to demonstrate their capability for “strong retaliation” and put on a show of “overwhelming force”, after his office convened a National Security Council session.
According to Yonhap, President Moon ordered his country’s military to display its capabilities that can “overwhelm” North Korea should the communist state decide to attack, the presidential office The show of overwhelming force involved the dropping of eight Mark 84 or MK84 multipurpose bombs by four F15K fighter jets at a shooting range near the inter-Korean border in Taebaek, Moon’s chief press secretary, Yoon Young-chan, told reporters.
“The NSC standing committee denounced North Korea for violating the U.N. Security Council resolutions by again launching ballistic missiles despite stern warnings,” Yoon told a press briefing.
Yoon also said that in a telephone conversation that also took place shortly after the latest North Korean missile provocation, South Korean Foreign Minister Kang Kyung-wha and her U.S. counterpart Rex Tillerson agreed to push for additional sanctions by the U.N. Security Council.
Futhermore, Gen. Jeong Kyeong-doo, chairman of South Korea’s Joint Chiefs of Staff, and his American counterpart Gen. Joseph Dunford agreed to take related measures at the earliest possible date, which apparently include the temporary dispatch of U.S. strategic assets like long-range bombers to Korea.
“We are considering the development of strategic assets in the US and we will consult with the United States.” US strategic weapons include B-1B strategic bombers, B-52 long-range nuclear bombers, stealth fighters, Aegis destroyers, and nuclear propulsion submarines, Yonhap reported.
Chung Eui-yong, Moon’s top security adviser, also held a telephone conversation with the White House’s National Security Adviser H.R. McMaster to discuss the allies’ joint measures against the North’s latest missile provocation. “McMaster said President Donald Trump fully supported President Moon’s North Korea policy and the South Korean government’s measures against North Korean provocations,” Yoon said.
As Yonhap concludes, “it’s quite unusual for the secretive nation to fire a ballistic missile from its capital, another sign that it’s diversifying launch areas to dodge external surveillance and a possible pre-emptive strike.”
Meanwhile, unlike previous launch instances, so far the S.Korean Kospi stock index has failed to rebound (yet), and was down 1.3% at last check…
… while the Kospi VIX, along with most Asian stock vol indicators, spiked in early trading.
Meanwhile, the Korean Won, which has become quite immune to Apocalyptic outcomes, sat near sessions lows, if well above where it was just ten days ago.
Discussing the resilience of the South Korean currency, Koon How Heng, head of markets strategy at United Overseas Bank Group said the won is “failing to properly price in risks surrounding North Korea and trade talks with the U.S.” He added that “risk remains that KRW will weaken and lift USD/KRW back towards the top end of the trading range” although it remains to be seen just what event – clearly a North Korean violation of Japanese airspace is not quiet “it” – will be sufficient to dislodge the currency from its perch.
Finally, in a curious tangent, while certainly not in Kim’s field of sight, Australian stocks just went negative for the year.