Korea Bond Market Daily Report: 2/10/2025
Korea Bond Market Daily Report
Treasury yields
| Treasury yields | Recent | DoD (bp) | YTD (bp) | YoY (bp) |
|---|---|---|---|---|
| 3Y KTB | 2.63% | ▲ 5.3 | ▲ 12.8 | ▼ 65.1 |
| 10Y KTB | 2.84% | ▲ 4.0 | ▲ 8.7 | ▼ 54.2 |
| Term Spread(bp) | 20.1 | ▼ 1.3 | ▼ 4.1 | ▲ 10.9 |
| Corp. AA- 3Y | 3.24% | ▲ 4.6 | ▲ 4.5 | ▼ 77.7 |
| Credit spread(bp) | 60.7 | ▼ 0.7 | ▼ 8.3 | ▼ 12.6 |
US Treasury Yields
| US Treasury Yields | Recent | DoD (bp) | YTD (bp) | YoY (bp) |
|---|---|---|---|---|
| 2Y US Treasury | 4.29% | ▲ 8.1 | ▲ 4.1 | ▼ 18.9 |
| 10Y US Treasury | 4.50% | ▲ 4.5 | ▼ 7.5 | ▲ 32.5 |
| Term Spread(bp) | 20.4 | ▼ 3.6 | ▼ 11.6 | ▲ 51.4 |
[Market Trends].
The US employment report confirmed lower-than-expected non-farm payrolls at 14.3 million in January, while the unemployment rate came in at 4.0%, below expectations of 4.1%. Meanwhile, average hourly earnings increased by 0.5% MoM, exceeding expectations of 0.3%. These economic indicators are putting upward pressure on US bond rates.
South Korea's government bond yields also continued to rise on hawkish comments from the Bank of Korea governor, especially ahead of the release of the US jobs report, which has made the market wary of a rate hike. This has heightened fears of a rate hike.
[Top economic news and events].
Top U.S. News
President Trump has revealed plans to impose a 25% tariff on all imported steel and aluminum, which will be announced next week.
In the US, the University of Michigan Consumer Confidence Index came in at a preliminary 67.8, below expectations of 71.8, while one-year inflation expectations came in at 4.3%, above expectations.
Featured News
South Korea's three-year government bond yield rose to 2.645%, which comes amid a trend of rising interest rates.
South Korea's January unemployment rate is scheduled to be released, and the market's reaction to the change is being closely watched.
Other News and Events
In the US, the release of the University of Michigan Consumer Sentiment Index for February is in the spotlight, and is expected to have a significant impact on consumer sentiment and the economy as a whole.
[Response Strategy].
As interest rate hike concerns intensify, fixed income investments require enhanced risk management of existing positions and close monitoring of interest rate movements, particularly in the U.S. and South Korea. Additionally, adjustments to equity positions in import-export related companies following Trump's tariff policy announcement should be considered.
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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