Korea’s Inclusion in WGBI Reconfirmed for April Next Year

FTSE Russell Announces Semi-Annual Review

The final schedule for the inclusion of Korean government bonds in the World Government Bond Index (WGBI), which was postponed to April next year, has been confirmed. As Korean government bonds are added to the WGBI-a benchmark widely used by global investors-up to 75 trillion won in overseas capital is expected to flow into the domestic market starting next year. This inflow is anticipated to contribute to lower funding costs for the government and corporations due to stabilized interest rates, as well as to ensure more stable fiscal management.

According to the Ministry of Economy and Finance on October 8, FTSE Russell, the UK-based Financial Times Stock Exchange, announced early that morning that Korea’s inclusion in the WGBI will begin as scheduled in April next year and be completed in November 2025. This reconfirms the technical inclusion timeline presented in the March 2025 review, as stated in the semi-annual country classification review released on the same day.

Previously, FTSE Russell announced during its semi-annual review in October last year that Korea would be included in the WGBI starting in November 2024, but in the March 2025 review, the start date was changed to April 2025. While the inclusion start date was postponed, the completion date remained November 2025. The plan is to gradually increase the inclusion weight each month so that the process is completed as originally scheduled.

FTSE Russell stated, “Korean government bonds will be included in the WGBI in eight monthly phases of equal weight from April to November next year,” and added, “We will work closely with the Korean government, investors, and market infrastructure institutions to ensure the smooth inclusion of Korean government bonds in the index.”

The WGBI is considered one of the world’s three major bond indices, alongside the Bloomberg-Barclays Global Aggregate Index and the JP Morgan Emerging Market Bond Index. It is composed of government bonds from 25 countries, including major advanced economies such as the United States, the United Kingdom, and Japan, as well as emerging markets.

Korea’s expected index weight is 2.08% as of October, ranking ninth after the United States (40.9%), China (10.1%), Japan (9.2%), France (6.5%), Italy (6.0%), Germany (5.2%), the United Kingdom (5.1%), and Spain (4.0%).

The government previously projected that at least $56 billion (about 75 trillion won) in capital would flow into Korea’s government bond market as a result of WGBI inclusion.

The Ministry of Economy and Finance stated, “This announcement will further enhance market predictability and contribute to strengthening the credibility and stability of Korea’s government bond market.”