CD/CP interest rate rises despite Monetary Policy Committee ‘pace control’… Treasury and Corporate Bonds Collapse and Comparison

(Seoul = Yonhap Infomax) Reporter Kim Jeong-hyun = As the Bank of Korea’s Monetary Policy Committee (Monetary Policy Committee) joined the theory of adjusting the pace of global tightening on the 24th, most interest rates fell sharply, but on the 91st, certificates of deposit (CD) and commercial paper (CP) Interest rates rose.

First of all, it is interpreted as following the increase in the base rate itself due to the very short term nature of bonds. In addition, they found that even if a warm wind blows through the bond market, it will take some time for the warmth to reach the CP market.

According to the Yonhap Infomax bond interest rate yield trend (screen number 4512), the yield on the 91-day CD final issue was 4.030%, up 1bp from the previous day. The CP 91 interest rate was also higher at 5.480%, up 8bp from the previous day.

On the other hand, most general bond yields fell, including government bonds, financial stabilization bonds, and corporate bonds.
Bond market participants first drew attention to the fact that the calculated CD and CP rates belonged to ‘super-short term’ products with 91 days. Although the MPC began to adjust the pace, the base rate itself was raised by 25bp, and very short-term bonds had no choice but to follow it first.

However, in the case of MSBs on this day, as the yield on the final 91-day issue has fallen by 2.2bp from 3.367% the previous day to 3.345% on the day, analysis that it is difficult to attribute the increase in Rates CD and CP interest to very short term bonds.

An exchange dealer at a securities firm said, “The 91-day CD rate tends to move by mirroring the Monetary Policy Committee’s daily base rate.”

In the case of the CP market, there is also a view that it is not easy to decline as credit risks have not yet been resolved.

A bond dealer from an asset management company said, “As the CP rate is also very short-term, it must have risen to reflect the increase in the base rate.” It’s a difficult situation to convey.”

For most of the day, interest rates fell.

The 2-year KTB yield was announced at 3.805%, down 15.6bp, the 3-year Treasury yield 3.689%, down 16.0bp, and the 5-year 3.718%, down 14.6bp. The 30-year bond closed at 3.649%, down 13.9bp, and the 50-year bond closed at 3.652%, down 13.7bp.

The 91-day MSB bond closed at 3.345%, down 2.2bp, and the 1-year Treasury bond closed at 3.777%, down 7.8bp. The two-year yield fell 12.0bp to 3.816%.

The ‘AA-‘ rating for corporate bonds with a maturity of 3 years was 5.402%, down 13.4bp, and the ‘BBB-‘ rating for corporate bonds with the same maturity was 11.239%, down 13.8bp.
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This article was submitted at 17:52, 2 hours earlier on the Infomax financial information terminal.

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