Skip to content

Sky-High House Prices Have Traders Betting Against Korea’s Bonds

  • Political discourse centers on debt levels, property prices
  • Unaffordable housing has eroded support for current government
Seoul Properties As Moon Government Facing Pressure To Ease Housing Affordability
Photographer: SeongJoon Cho/Bloomberg
Updated on

South Korean bond bears have reaped a windfall as yields surged since September. Politics may prove to be an unlikely ally as they bet on more gains.

Monetary policy is shaping up to be a key issue in the run-up to next year’s presidential election, with candidates expected to focus on ways to rein in soaring household debt, rising debt loads and asset-price bubbles. The case for higher interest rates got a boost Tuesday after Governor Lee Ju-yeol indicated the central bank may tighten in November.