South Korea has officially joined the World Government Bond Index (WGBI), announced the Finance Minister on Wednesday, with expectations of increased stability in the nation’s foreign exchange and financial markets.
Finance Minister Koo Yun-cheol shared the news via social media, emphasizing the WGBI’s importance as the leading sovereign bond index globally.
The WGBI, managed by FTSE Russell, tracks government bonds from 25 major economies worldwide, including the United States, Germany, China, and Japan. Assets tracking the index are estimated to be between US$2.5 trillion and $3 trillion.
South Korea’s complete inclusion in the WGBI is slated for completion by November.
“Following the WGBI inclusion announcement, foreign financial institutions and primary dealers of Korean Treasury bonds anticipate new capital inflows in the range of $50 billion to $60 billion. Initial inflows have already been observed this week,” Koo stated.
