S. Korean bonds close higher as UK votes to leave EU

The South Korean government bonds closed higher on Friday after Britain has voted to leave the European Union in a historic referendum which has thrown Westminster politics into disarray and sent the pound tumbling on the world markets.

The 10-year bonds yield, which moves inversely to its price fell more than 13 basis points to 1.497 percent, short-term 3-year bonds yield dipped nearly 10 basis points to 1.247 percent and the super-long 20-year bonds yield slid more than 12 basis points to 1.599 percent.

Britain has voted to leave the EU in a popular revolt that will send shockwaves across Europe, leaving David Cameron’s premiership hanging in the balance and triggering financial market turmoil across the globe. With all the votes counted, 51.9 percent voted to sever Britain’s 43-year membership of the EU, 48.1 percent to stay in.

Following the UK electorate's historic decision to jettison EU membership, Prime Minister David Cameron is to step down as PM in three months time. This suggests Chancellor Osborne will stand down as Finance Minister as well.

Lastly, South Korea's finance ministry, financial regulators and the BoK will hold an emergency meeting to discuss Brexit at 2 pm. South Korea's government will take market stabilising measures should FX market volatility increase due to Brexit, said Finance minister Choi.

Apart from this, South Korea ruling Saenuri party lawmaker Kim said that government officials have cut GDP growth outlook for 2016 to about 2.8 percent.

Meanwhile, The Korea Composite Stock Price Index (KOSPI) closed down 3.09 percent at 1,925.24 points.