00:02You're listening to AI Prism from Seoul Economic Daily.
00:39Korea's one has firmed into the 1,301 range against the dollar, yet foreign investors kept selling, which points to
00:46U.S. long-term rates rather than currency as the real driver.
00:49The 10-year U.S. Treasury yield hit 5.29% this week, the highest since 2007, widening the valuation
00:58gap for emerging market equities like Korea's.
01:01At the same time, Seoul is preparing to use a $63.2 trillion won tax revenue surplus to trim bond
01:07supply and stabilize domestic rates.
01:10Here's what the numbers show.
01:11Foreign investors net sold $21.5 trillion won, about $15.5 billion, of Kospi's shares in September, pushing the five
01:21-month cumulative outflow to $134.9 trillion won, roughly $97 billion.
01:29SK Hynix alone absorbed $11.6 trillion, one of that selling, with Samsung Electronics close behind at $4.9 trillion
01:37won.
01:38New York Fed President John Williams signaled a December hike over an October move, and Fed Fund's futures cut the
01:45odds of an October increase from 70% to 50% right after his remarks.
01:51The 10-year Treasury yield touched 5.29% and the 30-year hit 5.62% this week, both
01:58multi-decade highs.
01:59Korea's Finance Ministry is considering trimming this year's bond issuance by $10 to $13 trillion won, about $7 to $9
02:07billion, to send a rate stability signal.
02:10The Bank of Korea plans to buy roughly one ton of physical gold, worth $200 billion won, about $144 million,
02:18in December, its first such purchase in 13 years.
02:23Samsung Electronics' third-quarter earnings and September export data, both due in early October, will be the first test of
02:30whether foreign flows turn positive again.
02:32Korea's three-year bond yield fell to 4.011% and the 10-year to 4.407% on the
02:40issuance cut news.
02:41So what does this mean for global investors weighing Korea exposure?
02:45Earlier, we said the Fed just tilted toward a December hike instead of October.
02:49Here's what that actually means for you.
02:52With U.S. yields still near two-decade highs, Korea's valuation gap won't close until rate differentials narrow.
02:59So a tactical rotation into Korean equities looks more likely than a strategic one for now.
03:05Memory chip earnings strength and the government's bond issuance cuts offer some offset.
03:10But broad foreign inflows probably wait for softer U.S. inflation data.
03:14Watch three dates, Samsung's early October preliminary earnings, the October 27-28 FOMC meeting, and the November MSCI Korea Index
03:25Review, where zero new names currently qualify for inclusion.
03:29That's today's AI Prism, Global Investors.
03:32This episode was produced with AI assistance based on Seoul Economic Daily reporting and reviewed by a human editor.
03:41AI Prism is a Juan Ifra award-winning series.
03:44We'll be back tomorrow.
03:45You've been listening to AI Prism from Seoul Economic Daily.
