South Korean investors reacted to a steepening bond market as the KOSPI slipped on Monday, while bond yields climbed.
Bloomberg reports a 70% probability that the Bank of Korea will raise rates by a cumulative 50 basis points over the next six months, reflecting expectations of further tightening as government volatility‑curbing measures lose momentum.
The market reaction was compounded by fresh Houthi attacks on Saudi Arabia, including a strike on the kingdom’s main airport that killed 12 people, heightening fears of a wider conflict that could disrupt energy supplies.
Oil prices reflected that risk: Brent crude initially rose to $105.45 before sliding below $104 to $103.51 in early Asian trade, whereas West Texas Intermediate climbed 0.5% to $92.27 amid tanker attacks near the Strait of Hormuz.
With the 10‑year US yield near 5.4%—its highest since 2002—global rates may tighten further. Traders will monitor upcoming US CPI data and Fed Chair communications for clues on the pace of rate hikes, while South Korea’s BoK decisions will shape local bond market dynamics.