The Korea Financial Investment Association said on the 16th that foreign investors made a net purchase of 13.4 trillion won in domestic bonds in September this year. Government Bonds accounted for 11.8 trillion won and monetary stabilization bonds 800 billion won, with the net purchase expanding by 9.2 trillion won from Aug.
Foreign investors' holdings of domestic bonds also increased from 306.7 trillion won at the end of Aug. to 313.3 trillion won at the end of September. The Korea Financial Investment Association said the rebound in foreign net buying of domestic bonds was driven by increased issuance of Government Bonds by the government, inclusion in the World Government Bond Index, and rising foreign investment in Korea's financial markets.
Over-the-counter bond transaction volume was 516.9 trillion won in September, up 143.2 trillion won from Aug. During the same period, the average daily transaction amount was 23.5 trillion won, up 500 billion won.
Yields on Government Bonds swung throughout September. On expectations of a U.S. base rate cut, they fell through mid-month but ultimately ended higher on a surge in the won-dollar exchange rate and anxiety over real estate prices.