The Bank of Korea to End 'Unlimited RP Purchases' at Month-End... "Will Resume If Necessary"

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] The Bank of Korea announced on the 22nd that it will not further extend the full allotment repurchase agreement (RP) system and will end it at the end of July. This decision was made considering the improved funding conditions for securities companies and others, as well as the low bidding demand compared to the maturity scale.

However, even if the current regular full allotment RP purchases end, the Bank of Korea plans to resume full allotment RP purchases if the funding conditions for financial companies worsen or if financial market instability occurs due to increased interest rate volatility. Additionally, it plans to supply liquidity to the market through irregular RP purchases and other measures.

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