Government Bond Yields Rise Across the Board... "Impact of Foreign Investors' Net Selling"

Due to net selling by foreign investors, government bond yields closed higher across the board.

Yonhap News Agency

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On April 28 in the Seoul bond market, the yield on three-year government bonds ended at 3.529% per annum, up 0.037 percentage points from the previous trading day. This marks the first time the three-year yield has exceeded 3.5% since March 31, when it reached 3.552%.

The yield on the 10-year note rose by 0.041 percentage points to 3.861% per annum. The five-year and two-year yields increased by 0.042 percentage points and 0.034 percentage points, respectively, closing at 3.718% and 3.415% per annum.

The 20-year bond yield also rose by 0.034 percentage points from the previous session, closing at 3.798% per annum. The yields on the 30-year and 50-year bonds increased by 0.028 percentage points and 0.027 percentage points, ending at 3.711% and 3.575% per annum, respectively.

Foreign investors recorded net sales of 15,887 contracts in three-year treasury futures and 4,820 contracts in 10-year treasury futures, which drove up government bond yields. This appears to reflect concerns over a possible rate hike ahead of major central bank monetary policy meetings scheduled for this week.

The Bank of Japan, one of the major central banks, decided at its meeting on April 28 to keep its key short-term policy rate unchanged at "around 0.75%." However, given that Japan's real interest rate remains low and financial conditions are still accommodative, the central bank is expected to maintain its previous stance of potentially raising rates in the future.

The Bank of Japan, Japan's central bank, reached its decision on April 28, during its monetary policy meeting that began the previous day, to keep the key short-term policy rate at "around 0.75%."

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