3-Year Holds Post-BoK Losses

Bonds future lower in South Korea, 3-year and 10-year futures plunged after a more hawkish than expected BoK yesterday, the 3-year held the bulk of the move while the 10-year recovered into the close. BoK Governor Lee did briefly reference the bond market yesterday, saying the government could take steps to stabilise markets if needed, which would include buying more bonds. The reference was brief and nothing new from the Governor, though.

• Elsewhere the government has hired several banks as arrangers to sell foreign-currency denominated bonds according to Yonhap Infomax, the sales could be up to $1.5bn in September. Bank of America Merrill Lynch, Citi, JPMorgan, Credit Agricole, HSBC and KDB have all been hired.