SEOUL: South Korean treasury futures dropped early on Thursday, after stronger than expected industrial output data stoked market expectations for a rate rise next week, following a high consumer inflation reading.
South Korea's industrial output in January expanded by 4.6 percent from December, its fastest pace in nearly 1-? years, handily beating market projections.
The composite leading indicator, which presages economic activity in the coming months, staged its first month-on-month rebound in 13 months, data from Stastics Korea showed.
The March contract on three-year treasury futures lost 0.12 points to 102.84.
"Today's and yesterday's (CPI) data seems to erase uncertainties over future interest rate decisions," said a brokerage dealer. "Market interest rates may need to head back towards 4 percent."
Annual consumer inflation in February quickened at a faster rate than market expectations, data showed Wednesday.
But another broker said the turmoil in Libya had dented expectations for a rate rise.
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