Foreign investors sold off South Korean stocks and bonds in December, leading to an outflow of about $4.2 billion. This marks the largest capital flight since March 2020, when the COVID-19 pandemic sent shockwaves through financial markets.

South Korea's capital markets in December experienced the largest foreign outflows since March 2020 as heightened political uncertainty hit investor sentiment, central bank data showed on Wednesday.

In December, foreign investors sold a net $3.86 billion in Korean stocks and bonds, the highest since March 2020.