South Korean bonds fall

South Korean government bond prices dropped on Wednesday, with strong March job data and the government's upbeat outlook for April employment conditions spurring heavy foreign selling in treasury futures. The market attempted a brief rebound after Moody's Investors Service raised South Korea's sovereign rating to A1 from A2, about half an hour before market close.
But the optimism evaporated as investors reacted negatively to the Bank of Korea's announcement that it would withdraw the remaining emergency funds supplied to the private sector over the past two years as the financial system recovers. The June contract on 3-year treasury bond futures shed 17 ticks to 110.54, with foreign investors offloading a net 10,976 contracts, their largest single day sale since late December. The 5-year treasury bond yield rose 4 basis points to 4.56 percent, whereas 3-month certificate of deposit rates were unchanged at 2.45 percent on expectations that shorter-end yields would hold stable for the time being.