South Korea sells $ 1.3 billion in foreign exchange bonds at second lowest rate

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(Yonhap)

South Korea said Thursday it sold $ 1.3 billion worth of currency stabilization bonds at the second lowest rate on record amid strong demand.

The government sold $ 500 million US dollar-denominated bonds with a 10-year maturity and five-year euro-denominated debt valued at $ 700 million, according to the finance ministry.

Dollar bonds have a yield of 1.769%, which is 25 basis points more than the 10-year US Treasury bill rate, while euro bonds have a yield of minus 0.053%, he added. .

The bonds were issued at the second lowest rate, highlighting strong demand from foreign investors. Debt was also sold with the lowest spread ever against benchmark bond yields.

The finance ministry said the debt sale was successful despite heightened volatility in global financial markets amid rising inflation risks and major countries’ decision to adjust their monetary policy stance. .

Currency stabilization bonds are designed to raise the funds needed by the government to keep exchange rates stable.

Their yields are often used as a benchmark for Korean bonds traded on international financial markets.

South Korea’s foreign exchange reserves hit a record high of $ 463.97 billion in September, up $ 40 million from the previous month, according to central bank data. (Yonhap)


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