South Korean government bond prices retreated on Friday after two winning sessions, ahead of key economic indicators due next week that may give fresh clues on the direction interest rates may take. After a weaker start, the debt market staged a modest rebound towards midday, with foreign investors extending recent buying of treasury futures into their eighth straight session.
But the continuous foreign buying failed to revive interest among domestic institutions that have cautiously assessed whether the Bank of Korea would deliver another rate hike in August, after its surprise move to lift its base rate this month. The three-year treasury yield rose three basis points to 3.85 percent, coming off its near three-week low touched on Thursday.
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