Foreign investment in South Korea's bond market edged down in August, falling for the first time in six months as some bonds matured, data from the country's financial regulator showed on Friday. Offshore investors reduced their holdings of won-denominated bonds by 82 billion won (80.50 million US dollars) in August, the Financial Supervisory Service said, in comparison to July when they boosted their holdings by 490 billion won.
It marked the first time since February that foreigners had not increased their holdings. The FSS data showed 2.41 trillion won in redemptions on matured debt wiped out 2.33 trillion won in net purchases of local debt last month. Luxembourg investors were the biggest sellers in August, lowering their holdings by 0.4 trillion won, followed by investors in the US and France.
Investors in Malaysia boosted their bond holdings by 0.5 trillion won and those in China added 0.1 trillion won to their won-denominated bond investments. As of end-August, foreigners carried 98.09 trillion won worth of South Korean paper, the data showed, with US investors holding 19.6 percent of the total amount. Meanwhile, the same data showed foreigners were net buyers of South Korean shares for a fifth straight month in August, snapping up 2.46 trillion won worth, slightly less than the net 3.58 trillion won worth they bought in July.
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