By Shinhyung, Lee and Cynthia Kim
SEOUL (Reuters) – South Korea has seen a stable flow of foreign investment into local government bonds this week, including from central banks and even as political tensions around North Korea persist, a finance ministry official said on Thursday.
“There is a continued influx (into South Korean treasury bonds) from many central banks as they retain a stable outlook on South Korea’s economic fundamentals and credit rating,” Park Seong-dong, director general of the treasury bureau told Reuters in a written interview.
Although foreign investors offloaded Korean treasury bonds in late September in the face of renewed tensions between North Korea and the United States, there have been no signs of outflows from bond market this month, Park said.
The yield on 10-year treasury bonds soared to a two-year high of 2.435 percent on Sept. 28. The yield was at 2.398 percent on Thursday.
Park also said the government may increase the issuance of 30-year bonds later this year as it adjust monthly allocation plans.