SEOUL Nov 5 Foreigners' net investment in South
Korean bonds rose for the second consecutive month in October as
the Chilean central bank increased its exposure to
won-denominated debt, South Korean government data showed on
Net foreign inflows to the local debt market totalled 361
billion won ($330.93 million) last month, the Financial
Supervisory Service (FSS) said, despite 2.7 trillion won in
redemptions for debt that matured.
Investors from Chile were the biggest investors, buying 555
billion won worth of the debt. An FSS official said the Chilean
central bank started buying local debt in September and did so
again in October, without elaborating on how much the authority
Chile's central bank is the latest of foreign central banks
that have begun investing in local debt as South Korea's strong
economic fundamentals have led to a series of sovereign ratings
upgrades between August and September.
Norway's sovereign wealth fund and Switzerland's central
bank also continued to increase their holdings in South Korean
bonds in October, the FSS official said, underscoring growing
investor confidence in local debt as a safehaven.
But Chinese investors sold a net 351.6 billion worth of
local bonds in October, marking the first decline since May.
This was also the biggest decline on record in Chinese
investors' holdings in South Korean debt.
Foreigners sold 1.1 trillion won worth of local stocks
during the month on profit-taking following the Korean won's
recent appreciation as well as renewed concerns about the
This translated to a net 741 billion won in total foreign
outflows from local securities in October, marking the first
such fall since June.
($1 = 1090.8750 Korean won)
(Reporting By Se Young Lee; Editing by Jacqueline Wong)