Trump says US to scale back military drills with South Korea after it stayed out of Iran war

President Trump said the United States will scale back joint military exercises with South Korea, attributing the move to Seoul’s decision to decline participation in the U.S.-led military effort against Iran. The announcement represents a notable shift in a long-standing alliance that has relied on regular drills to deter North Korea and maintain regional stability.

For markets, the development introduces fresh questions about the U.S. security commitment to the Korean Peninsula. A reduced military exercise schedule could raise the perceived geopolitical risk premium for South Korean assets, potentially affecting the won, local equities, and foreign investment sentiment. Defense firms closely tied to regional procurement may also recalibr