Seoul: Bond sales in South Korea saw a notable rise in September, driven by an increase in government bond issuance following a supplementary budget by the government, recent data indicated.
According to Yonhap News Agency, the Korea Financial Investment Association (KOFIA) reported that the total value of bonds sold in the country reached 94.6 trillion won (approximately US$66.6 billion) last month. This marked an increase of 20.3 trillion won compared to the previous month.
The yield on three-year Treasury bonds experienced an uptick, closing at 2.582 percent in September, a rise of 15.6 basis points from the previous month. KOFIA attributed the higher Treasury bond yields to factors such as the depreciation of the Korean won against the U.S. dollar and instability in the local housing market.
Corporate bond issuance also climbed during this period, reaching 16.1 trillion won, up from 7.6 trillion won. In terms of grade, AAA bonds increased by 600 billion won, AA bonds by 4 trillion won, and A bonds by 2.3 trillion won.
Demand forecasting for corporate bonds was recorded at 4.8 trillion won in September, reflecting a decrease of 1.2 trillion won compared to the same period last year, as per KOFIA's data.
In the bond market, individual investors net purchased bonds worth 3.7 trillion won. Foreign investors showed significant activity, adding bonds worth 13.4 trillion won, including 11.8 trillion won in government bonds.