But it rebounded as the government pledged to keep inflation expectations from quickly building up by controlling prices of key products while central bank data showed the business start-up/failure ratio dropped to a seven-month low in December.
"Some investors were concerned that fourth-quarter GDP data may turn out strong enough to add pressure for an early rate hike," aid a fixed-income analyst at a local brokerage. The Bank of Korea releases its advance estimate for fourth-quarter GDP data on January 26. It reviews rates on February 11. The benchmark five-year treasury bond yield rose 3 basis points before ending unchanged from Tuesday's close of 4.80 percent.
The March treasury bond futures contract rose 3 ticks to 109.59 after losing as much as 15 ticks earlier in the day, with foreign investors staying net buyers for an eighth consecutive session. On the primary market, the central bank issued 2.5 trillion won ($2.21 billion) in 2-year monetary stabilisation notes at an average yield of 4.25 percent, drawing bids of more than 4 trillion won.