South Korea’s Stimulus Plan Likely to Drive Up Bond Yields

South Korea’s bid to tackle a slowing economy via fiscal stimulus will pressure the won and may steepen the yield curve at a time when the bond market is already absorbing a record amount of issuance.

Faced with potential US tariffs and fallout from its brush with martial law, the country is looking at stimulus to help the economy. The opposition party, which holds a majority of seats in parliament, recently proposed an outlay of 35 trillion won ($24 billion) — and there have been suggestions to sell more debt to help fund the expenditure.