Zhitong Finance learned that data from the Korea Financial Supervisory Service (Financial Supervisory Service) showed that foreign capital inflows into South Korean bonds surged on Tuesday, with net purchases exceeding 1 billion US dollars, the highest level since November last year. Overseas investors have been making net purchases of Korean treasury bonds for 14 consecutive days, setting the longest continuous buying record since May. Deutsche Bank Financial Investment (DB Financial Investment) said that capital inflows may be due to expectations of a further strengthening of the Korean won and that Korean bonds may be included in FTSE Russell's World Government Bond Index (World Government Bond Index). Against this backdrop, the Fed's interest rate cut bets have generally increased the appeal of emerging Asian assets.

This wave of buying shows that the market, which ranked first in terms of net inflows of foreign capital last year, is still attractive. Global capital is pouring into Asian emerging market stocks and bonds this year, which shows that investor confidence in the region has improved as the Federal Reserve approaches interest rate cuts.

Moon Hongcheol, a fixed income and foreign exchange strategist at Deutsche Bank, said that the prospects for the strengthening of the Korean won and the possibility that Korean bonds will be included in FTSE's global bond benchmark may be the driving factors. “The won is relatively weak, and technically it is more likely to strengthen further,” Moon added.

Moon predicts that the exchange rate of the won against the US dollar will rise to 1,250 won per dollar this year, and Korean bonds will be included in the Fuji Index next year. On Wednesday, the exchange rate of the won against the US dollar was 1341.70 won against the US dollar, with little change.