Overseas Issuance On The Cards

After seeing gains at the open futures have fallen into negative territory, 10-year future down 6 ticks after finishing with gains on Friday, US futures finished slightly lower on Friday, but are up around 3 ticks on the session. In the cash space yields are slightly lower in the short end and flat in the long end. US/SK 10-Year spreads are broadly unchanged from Friday, last at 62.84bps.

• There were reports in Yonhap over the weekend that South Korea is planning to issue up to $1.5bn worth of overseas bonds during the second half of the year to capitalize on favorable funding conditions. According to the reports, the finance ministry has recently completed the process to pick a lead manager for the planned debt sale. Last week Fitch affirmed South Korea at AA- with a stable outlook.
• Elsewhere the BoK has announced plans to stop issuance of 182-day monetary stabilisation bonds (MSB's) to improve the efficiency of OMOs. The Central Bank plans to increase the issuance of 91-day MSBs to around KRW 1t each month and reducing the issuance of 1-year and 2-year MSBs to around KRW 1.2t and KRW 2.5t respectively every month starting from Sept. 1. The BoK will sell KRW 700bn of 1-Year MSB's today, results due after 0230BST/0930HKT.
• There could be some focus on the 2021 tax revision bill set to be released by the finance ministry, over the weekend the government passed its second biggest extra budget of the pandemic, worth KRW 34.9tn. The budget includes a cash handout to almost all residents. Meanwhile, the BoK will sell KRW 700bn of 1-Year MSB's today.