South Korea’s government bonds were set for the worst week in two months as the nomination of a former Bank of Korea official to be the next governor damped speculation the monetary authority may cut rates.
South Korean President Park Geun Hye nominated a Bank of Korea veteran to be the next governor, seeking to avoid controversies that have plagued past personnel picks and drive growth in Asia’s fourth-largest economy.
Carlyle Group LP agreed to buy Tyco International Ltd.’s fire and security business in South Korea for $1.93 billion, the country’s largest private-equity buyout deal in U.S. dollar value in more than five years.
The Bank of Korea should refrain from any immediate interest-rate move and has “leeway” because the Federal Reserve isn’t expected to move until late 2015, an economic adviser to President Park Geun Hye said.
South Korea’s 10-year government bonds are set for the biggest monthly rally since September as slowing growth in the nation’s largest export market spurred investors to seek the relative safety of sovereign debt.