3-Year Bond Yield Drops to 5% Level

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3-Year Bond Yield Drops to 5% Level

The interest rate of the benchmark three-year government bond dropped below the 5 percent level for the first time on Monday.

Interest rates on treasury bonds started to fall from the opening of trading in the bond market and closed at 5.0 percent, an 0.18 percentage point decrease from Sunday. Just before the closing bell, the yield briefly dropped to 4.99 percent.

Yields on the five-year government bond also plunged by 0.27 percentage point to 5.09 percent.

"It appears that low interest rates have started to take hold in the Korean market," said an official from Citibank. "But some institutional investors seem to be making speculative investments in government bonds, expecting the interest rates to decline even further."

by Cheong Chul-gun

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