[Photo by Yonhap News]
SEOUL, October 23 (AJP) - South Korea has raised $1.7 billion in foreign-currency sovereign bonds at record-low spreads, signaling investor confidence in Asia’s fourth-largest economy despite U.S. tariff uncertainties and slowing global demand, the Ministry of Economy and Finance said Thursday.
The ministry said it completed the issuance of $1 billion in U.S. dollar-denominated bonds and 100 billion yen (about $700 million) in yen-denominated foreign-exchange stabilization bonds.
The dollar-denominated bond was priced at 3.741 percent, just 17 basis points above the corresponding five-year U.S. Treasury yield — beating the previous record-low spread of 25 basis points set in 2024.
The multi-tranche yen issuance spanned two, three, 5.25- and ten-year maturities, with yields as follows:
The ministry said it completed the issuance of $1 billion in U.S. dollar-denominated bonds and 100 billion yen (about $700 million) in yen-denominated foreign-exchange stabilization bonds.
The dollar-denominated bond was priced at 3.741 percent, just 17 basis points above the corresponding five-year U.S. Treasury yield — beating the previous record-low spread of 25 basis points set in 2024.
The multi-tranche yen issuance spanned two, three, 5.25- and ten-year maturities, with yields as follows:
3-year at 1.208% (TONA mid-swap +20 bps)
5.25-year at 1.457% (TONA mid-swap +30 bps)
10-year at 1.919% (TONA mid-swap +46 bps)
TONA mid-swap serves as the benchmark rate in the yen bond market.
With the latest sale, total foreign-exchange stabilization bond issuance this year reached $3.4 billion — the largest since the program was introduced in the wake of the 1998 Asian financial crisis and just shy of the $3.5 billion annual ceiling approved under the May supplementary budget.
In the first half, the government issued 1.4 billion euro (about $1.5 billion) in euro-denominated bonds, marking the first time South Korea has completed FX stabilization issuance in all three major global currencies — the dollar, euro and yen — within a single year.
“This year’s successful issuance of foreign-exchange stabilization bonds in the world’s three major currencies is expected to improve overall conditions for foreign-currency procurement in the domestic market,” the ministry said in a statement.
As of 2 p.m. in Seoul, the won was trading at 1,440.8 per U.S. dollar on Thursday, down 8 won from the previous session.
* This article, published by Aju Business Daily, was translated by AI and edited by AJP.
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