Korea Bond Market Daily Report(Gemini): 11/28/2024
Korea Bond Market Daily Report
Treasury yields
| Treasury yields | Recent | DoD (bp) | YTD (bp) | YoY (bp) |
|---|---|---|---|---|
| 3Y KTB | 2.74% | ▼ 3.2 | ▼ 49.9 | ▼ 94.8 |
| 10Y KTB | 2.88% | ▼ 2.3 | ▼ 42.6 | ▼ 88.7 |
| Term Spread(bp) | 13.9 | ▲ 0.9 | ▲ 7.3 | ▲ 6.1 |
| Corp. AA- 3Y | 3.32% | ▼ 2.7 | ▼ 66.4 | ▼ 113.2 |
| Credit spread(bp) | 57.5 | ▲ 0.5 | ▼ 16.5 | ▼ 18.4 |
US Treasury Yields
| US Treasury Yields | Recent | DoD (bp) | YTD (bp) | YoY (bp) |
|---|---|---|---|---|
| 2Y US Treasury | 4.25% | ▲ 4.2 | ▼ 7.8 | ▼ 58.8 |
| 10Y US Treasury | 4.30% | ▼ 0.2 | ▲ 34.8 | ▼ 9.2 |
| Term Spread(bp) | 4.6 | ▼ 4.4 | ▲ 42.6 | ▲ 49.6 |
[Market Trends].
US Treasury rates fell as October PCE inflation came in in line with expectations. Expectations for a December rate cut remain.
Both the U.S. and South Korea have seen interest rates fall, especially in South Korea, where market participants are focusing on the November meeting of the Monetary Policy Committee.
[Top economic news and events].
Top U.S. News
October's headline PCE price index was in line with expectations, adding to expectations of slower inflation.
Former President Donald Trump's appointment of a special envoy for Ukraine and Russia has raised questions about possible changes in U.S. policy toward Ukraine in the future.
Featured News
Ahead of the November Monetary Policy Committee meeting, nervousness among domestic market participants has increased. Concerns about a possible rate cut and exchange rate fluctuations coexist.
Domestic interest rates continued to fall, with the 3-year Treasury note falling 2.74% (-3.2 basis points) and the 10-year note falling 2.88% (-2.3 basis points), according to FutureSecurities bond analysis.
Other News and Events
The Reserve Bank of New Zealand (RBNZ) cut its benchmark interest rate by 50 basis points.
The possibility of further adjustments to the Fed's RRP rate has been raised, demonstrating confidence in the stability of short-term money markets.
[Response Strategy].
Given the current market conditions, a pigeon-holing strategy makes the most sense. Given the excessive market expectations and exchange rate volatility, a cautious approach is required. Keep open the possibility of a rate cut, but be careful not to unduly shock the market.
Disclaimer The information contained in this report has been obtained from sources believed to be reliable, but we do not guarantee its accuracy or completeness. This report is for informational purposes only and is not a solicitation or offer to buy or sell any security or financial instrument. Opinions expressed in this report are subject to change without notice. Investment decisions are the sole responsibility of the investor and you should seek professional advice as needed
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