Korean bond yields seen jumping on Mers stimulus

Seoul

SOUTH Korea's bond market is bracing for a jump in yields as the government plans new spending to protect the economy from a deadly virus that's damping confidence.

Issuance to fund the stimulus will add to a planned increase in sovereign sales and record supply of mortgage-backed debt. That will push the benchmark 10-year yield to 2.60 per cent this month, a level last seen in January, according to the median estimate of six primary dealers and two brokerages surveyed by Bloomberg on June 18 and June 19.