South Korea's AA-Grade Corporate Bond Yields Hit 4.653% on July 24, Highest Level in 32 Months

According to Edaily, on July 24, AA-grade 3-year corporate bond yields reached 4.653%, the highest level since November 14, 2023. This followed South Korea's central bank raising its base rate by 0.25 percentage points to 2.75% on July 16, marking an end to eight consecutive hold periods. Market participants view this as the beginning of a rate-hiking cycle, with some analysts projecting the base rate could reach 3.50% by year-end.

BBB-grade 3-year bond yields climbed to 10.45% on July 24, the highest since February 2024. Amid heightened credit concerns stemming from recent defaults by major corporations, prime-rated corporate bonds attracted substantial inflows while lower-grade bonds faced investor avoidance, widening the credit quality divide in the market.