Yesterday the Korean Won broke 1400 as the BOK has seemingly given up defending that level.

Why?

Yesterday's 10yr Govt bond auction was met with poor demand. The govt was able to raise KRW584 bill @5.2% versus the target 800 bill. In Jan it got only 462 bill out of 800 bill target also.

Rates are going to have to go higher. Not surprising to see Korean bond spreads moving higher today.