South Korean investors increase U.S. Treasury purchases as yields top 5%

Sep 30, 2026 11:12 (23d ago)

South Korean retail investors bought billions of dollars of U.S. bonds during the third quarter as Treasury yields rose above 5%.
September net U.S. bond purchases were $1.363 billion, while domestic bond purchases reached 4.0225 trillion won.
The buying followed June net sales, but analysts warned that further rate increases could reduce existing bond prices.

South Korean retail investors increased purchases of U.S. Treasuries and domestic bonds as U.S. yields climbed above 5%, stock-market volatility encouraged shifts from risk assets, and a stronger won reduced the cost of dollar-denominated investments. Korea Securities Depository data put third-quarter net U.S. Treasury purchases at about $3.9 billion, the largest quarterly total since records began in 2011, while a newer SEIBro monthly breakdown reported $1.363 billion of net U.S. bond purchases in September after $889 million in July and $1.821 billion in August. Individual investors also bought 4.0225 trillion won of South Korean bonds in September. Analysts said higher yields support carry trades focused on interest income but warned further rate increases could push bond prices lower and limit capital gains.