The Asian country’s current-account surplus rose to a record high in November last year, taking its total for the first 11 months of 2012 to well over central bank forecasts and boosting the currency. The surplus was $6.88 billion in November, a record.

And the currency has benefited. The won reached a 17-month high against the dollar last Friday because low interest rates in countries such as the US made the Asian currency attractive, reports said. The won fetched around KRW1.056 against the dollar on Monday. Last week, it hit the KRW1.060 mark; there have been rumours of central bank intervention to cap it.

“The KRW in 2013. As we expect this to be in the context of a wider band, we also look for more cyclicality in USDCNY,” Yates said.

More generally, Yates said that this year will see more loose monetary policy but with fewer downside risks for the global economy, arguing that growth in the US and China will improve while some of the risks of the debt-ridden eurozone have abated.

“This environment means three things for currencies: investors will continue to look for yield; they will be more comfortable in moving along the risk spectrum; and a currency’s fundamentals will matter more,” she said.