As the interest burden of the fiscal deficit increases due to the surge in the interest rate of the US Treasury bond, it has begun to show a telephoto effect of increasing the amplitude of the sharp fluctuation.
The government prepared for interest expenses of KRW 20 trillion by adding a maximum interest rate of 2.4% to the issuance of an additional KRW 100 trillion in deficit treasury bonds this year, but yesterday (4th), the 10-year interest rate surpassed 1.56% and Korea also exceeded the 2.0% level due to the surge in US bond rates.
Last year, the issuance of Treasury bonds has already surpassed 174 trillion won and has soared 73 trillion won a year. When the size of deficit Treasury bonds this year was expanded to exceed 100 trillion won, the surge in US Treasury yields in addition to the continued rise in market interest rates centered on mid- to long-term government bonds was shocked. done.
The rise in U.S. Treasury bond yields affects the lending rate beyond Korean Treasury bonds, causing the interest burden on households and businesses to soar, and the pressure on private debt seems to have been directly linked to credit ratings.
Last year, the issuance of KTBs surged to 72.8 trillion won from a year ago, to 17.75 trillion won, and the funding interest rate had the lowest effect from the continued low interest rate of the corona, but interest rates have overlapped with the additional issuance of 100 trillion won this year.
When the Fed Chairman's remarks on the 4th failed to control interest rates, the US 10-year Treasury bond rate soared to the mid-1.5% range, and the New York Stock Exchange immediately plummeted, causing the tech stock Nasdaq index to fall 2.11%, reversing this year's gains.
The rise in US interest rates on the 4th directly affected the Japanese yen exchange rate market, and the dollar in New York exchange rate rose to 107.840 yen, 0.922 yen (0.86%) higher than the previous day's 106.978 yen, and the Japanese yen, the safe currency, is the US Treasury yield and Japanese government bonds. It responded to the yield spread.
The value of the won began to fluctuate on the 5th due to a sharp decline in the stock market due to the surge in New York interest rates, and the won per dollar in the Seoul foreign exchange market started at 1132.1 won, which was 7.1 won lower than the previous day's closing price (the exchange rate increased).
The rise in US market interest rates is directly linked to the mortgage interest rate, a real estate lender, and the Wall Street Journal reported that Freddie Mac, a financial company, calculated the average interest rate (based on a fixed rate) of 30-year mortgages at an annual rate of 3.02%.
WSJ said that it was only 8 months since July of last year that the average interest rate on a 30-year mortgage has exceeded 3%, and that the interest rate on the mortgage interest rate, which supports the American housing market, was in the 2% range at an ultra-low interest rate throughout the coronavirus.
U.S. Treasury yields were 1.471%, down 0.8bp from the previous trading day, in the New York bond market before the Powell Fed chairman's remarks at the time of opening on the 4th, and 30-year bonds were 2.255%, down 0.6bp from the previous trading day. The annual product once exceeded 1.6%.
The unemployment situation in the United States is an increase from mid-February, with the number of weekly unemployment insurance claims at 745,000 compared to a month ago even with the corona vaccine.
The US electric car Tesla, which was attracted by Korean individual investors, fell 4.86% (31.76 points) on the NASDAQ on the 4th from the previous day, and fell 3.43% after the closing, reverting to $600 on December 9 last year and reverting to $604 on December 9 last year, for two weeks 23 % Showed a plunge.
The US Morgan Stanley report found that Tesla's electric car market share in the U.S. fell 12 percentage points in February from the previous year (81%) to 69%, and that the No. 1 market share in the European electric car market in 2019 (31%) plummeted to 13% last year.3 Sun said.
Deputy Prime Minister Hong Nam-gi (Minister of Finance) said in the Korean and English version of the government bond white paper'Government Bond 2020', "In the process of overcoming Corona 19, the government bond market played a role as a strong support for the national finance and financial markets."
Unlike the U.S., the KOSPI index slightly fell 2.72 points (0.29%) on the previous trading day, and the KOSPI index fell 17.23 points (0.57%) compared to the previous trading day, 3026.27. On that day, foreigners and institutions sold 3701 billion won and 805.4 billion won respectively.