South Korea tackles potential bond market volatility: official
SEOUL, May 11 (Yonhap) – South Korea plans to respond to potential volatility in the government bond market as concerns over global inflation and other risk factors could cause market instability debt, a senior government official said on Tuesday.
Second Deputy Finance Minister Ahn Do-geol said the Korean bond market stabilized after high volatility triggered by a spike in yields on US Treasuries, but risk factors at home and abroad abroad remain.
He cited bond supply situations, global inflation risks and warnings related to the early normalization of accommodative monetary policy as major risk factors for the bond market.
“The government will actively seek to stabilize the government bond market, as a potential increase in volatility could hurt financial markets and undermine a recovery in the real economy,” Ahn said in a meeting with officials. bond market experts.
The yield on longer-term Korean government bonds has risen alongside spikes in global bond rates and concerns about the country’s massive debt sell-off. The 10-year Treasury yield was 2.218% at the end of April, up 16.1 percentage points from the previous month.
The government sold bonds worth 50.4 trillion won (US $ 45 billion) in the first quarter, or 27 percent of the expected annual debt sale of 186.3 trillion won.
Foreign investors bought 11 trillion won net of Korean government bonds in the first quarter, up from 8.6 trillion won three months earlier, according to the finance ministry.