Market Focuses on Third-Quarter GDP Growth Surpassing Expectations
On the 28th, government bond yields showed a mixed trend as the market remained in a wait-and-see mode regarding expectations of a rate cut by the Bank of Korea.
Lee Changyong, Governor of the Bank of Korea, is speaking at a press conference regarding the Monetary Policy Committee's interest rate decision held on the 23rd at the Bank of Korea in Jung-gu, Seoul. Photo by Yonhap News
On this day, in the Seoul bond market, the yield on three-year government bonds closed at 2.633% per annum, up 1.3 basis points (1bp = 0.01 percentage point) from the previous trading day.
The yield on ten-year bonds fell by 2.4 basis points to 2.935% per annum. The five-year yield declined by 0.5 basis points to 2.751% per annum, while the two-year yield rose by 1.8 basis points to 2.574% per annum.
The yield on twenty-year bonds decreased by 0.1 basis points to 2.936% per annum. The yields on thirty-year and fifty-year bonds dropped by 1.5 basis points and 1.3 basis points, closing at 2.835% and 2.680% per annum, respectively.
The market on this day focused on the third-quarter gross domestic product (GDP) growth rate, which exceeded expectations. As the GDP figures improved, expectations for a rate cut next month diminished, leading to an increase in yields on short-term bonds such as the three-year note.
According to the Bank of Korea, real GDP growth for the third quarter was recorded at 1.2% quarter-on-quarter, surpassing the Bank’s August forecast of 1.1%.
Yields on long-term bonds such as the ten-year note, which are influenced by U.S. Treasury yields, showed a downward trend.
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