South Korea's 30-Year and 50-Year Bonds Hit Record Highs on July 21-22

According to Yonhapnews, South Korea's long-term government bond yields surged to historic highs on July 21-22, with 20-year bonds reaching their highest level since May 2011 and 30-year and 50-year bonds setting all-time records. The 20-year yield rose 2.9 basis points, while 30-year and 50-year yields climbed 4.4 and 4.0 basis points, respectively. In contrast, short-term 2-year and 3-year bond yields fell 3.7 and 2.8 basis points to 3.692% and 3.867%, supported by capital inflows from SK Hynix's American Depositary Receipt conversions flowing into money market funds and short-term debt instruments.

Supply-demand imbalance drives the divergence, as insurance companies—major long-term investors—reduced purchases after their solvency ratios improved with rising rates, while foreign capital inflows from World Government Bond Index inclusion focused on 5-year bonds, leaving ultra-long maturities undersupported.