S.Korean bonds down on KDI report, auctions

SEOUL, Nov 23 - South Korean government bonds fell early on Monday after a state-run research agency called on the authorities to gradually exit from emergency policy measures on a robust growth outlook for next year.

The Korea Development Institute projected 5.5 percent growth for Asia's fourth-largest economy next year while expecting the central bank to raise interest rates in the first quarter of 2010. [ID:nSP472949]

Planned auctions also kept debt investors at bay. The finance ministry is set to issue 0.8 trillion won worth of 20-year treasury notes while the central bank will sell 6 trillion won in monetary stabilisation bonds with various tenors throughout the session. The benchmark five-year government bond yield <KRTSY5Y=KQ> rose 6 basis points to 4.82 percent while the three-year yield <KRTSY3Y=KQ> also gained 6 basis points to 4.32 percent.

Front-end treasury bond futures <KTBc1> fell 15 ticks to 109.61 as of 0107 GMT. ((eunkyung.seo@thomsonreuters.com;+822 3704 5648; Reuters Messaging:eunkyung.seo.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))