South Korea's Ministry of Economy and Finance convened the fourth meeting of the WGBI Standing Monitoring and Investment Attraction Task Force to review foreign capital inflows around the start of WGBI inclusion and coordinate responses to issues raised by investors during a recent Japan investor-relations programme. The ministry assessed that foreign inflows since April have been proceeding smoothly and have contributed to lower Korean government bond yields, while calling for tighter preparation ahead of expected stronger inflows in May amid heightened external risks. Foreign investors’ net purchases of Korean government bonds totalled KRW 8.5 trillion on a trade-date basis from March 30 to April 21, and KRW 6.4 trillion on a settlement basis from April 1 to April 21, reflecting the lag between trade and settlement dates. Japanese-linked inflows were described as somewhat limited, but inflows from existing investors continued. Over March 27 to April 21, government bond yields fell by 25.2 basis points for the three-year (3.552% to 3.330%), 26.0 basis points for the 10-year (3.915% to 3.655%), and 27.5 basis points for the 30-year (3.810% to 3.535%); the meeting included the Financial Services Commission, the Bank of Korea, the Financial Supervisory Service and the Korea Securities Depository. Authorities agreed to share the investor frictions raised during the Japan IR and to develop improvement measures through the task force, alongside continuing regular monitoring of inflow conditions and ongoing IR with foreign investors.

Original source View in tracker