SEJONG, Aug. 16 (Korea Bizwire) – South Korea is considering selling state bonds that mature in 50 years as part of efforts to manage fiscal policy in a more stable manner, the finance ministry here said Tuesday.
It will decide the exact timing of the issuance and detailed terms and conditions, as well as the amount, after collecting opinions from experts later this month, according to the Ministry of Strategy and Finance.
The ministry said that a low interest rate trend and narrowed difference between long-term and short-term rates have changed the market conditions and spurred demand for longer-term Treasurys.
The government expects the country’s fiscal health and strong macroeconomic fundamentals to help it successfully sell the 50-year bonds.
The South Korean government sells five types of state bonds ranging from three-year bonds to 30-year ones with those with a maturity of three years and five years accounting for 46 percent of the total bond sales.
Bonds with the longest maturity of 10 years and longer made up 27 percent, the ministry said.