Mixed Dealing Again, Global Bonds Weigh On South Korean Bonds

Asian Government Bonds are mixed again today, with Chinese bonds little changed but South Korean bonds heavy.

• China Government bonds are dealing flat to 0.3bp cheaper across benchmarks ahead of official PMIs for May tomorrow. The market expects a slight improvement in both the manufacturing and non-manufacturing outcomes.
• For manufacturing the consensus sits at 50.5, versus 50.4 prior.
• On the services or non-manufacturing side, the consensus is for a 51.5 outcome, versus 51.2 prior. The survey range is 51.0 to 52.3. This side of the economy has generally been under more pressure, with consumer spending softening and property-related activity remaining depressed. In recent months we have seen efforts to boost property sentiment step up.
• The South Korean Sovereign bond curve is heavy again today, with yields flat to 5bps cheaper despite an empty data calendar. Once again today’s move appears tied to global bond developments.
• The only other local news was the announcement of plans to open up its bond market to individual investors with the first-ever issuance lined up in June.
• Tomorrow will see April IP and cyclical leading index figures.