Net Inflow of Foreign Investors' Domestic Stock Investment Funds Turns Positive in April... $590 Million Net Inflow

Bank of Korea 'International Finance and Foreign Exchange Market Trends Since April 2021'

[Image source=Yonhap News]

[Asia Economy Reporter Kim Eun-byeol] Last month, foreign investors' funds for domestic stock investment turned to a net inflow. This was the result of a reduction in profit-taking sell-offs and growing expectations for domestic and global economic recovery.

According to the "International Financial and Foreign Exchange Market Trends since April 2021" released by the Bank of Korea on the 12th, foreign stock investment funds recorded a net inflow of 590 million USD in April. This marked a reversal from March, when foreign stock investment funds saw a net outflow of 2.58 billion USD.

Bond funds saw a net inflow of 2.74 billion USD, although this was a decrease compared to March's inflow of 8.35 billion USD. The reduction in bond fund inflows was analyzed to be centered around public funds.

In April, the KRW-USD exchange rate declined despite foreign investors' demand for converting dividends from domestic stocks, influenced by the weakening of the US dollar and favorable economic indicators in South Korea. The Bank of Korea explained, "In early May, the exchange rate rose significantly due to concerns over early tapering but then fell after the US non-farm payrolls report for April significantly missed expectations, raising hopes that the US Federal Reserve (Fed) would maintain an accommodative stance."

The daily volatility of the KRW-USD exchange rate in April was 0.28%, with a fluctuation range of 3.2 KRW. This was a reduction compared to March's volatility of 0.31% and fluctuation range of 3.5 KRW.

This content was produced with the assistance of AI translation services.