Increase in Reserves by 10 Trillion Won, Surplus in Short-Term Funds Expected on the 24th

On the 24th, the domestic short-term money market is expected to see the reserves turn into a surplus. The factors contributing to the increase in reserves are estimated at 10 trillion won, while the factors for decrease are 2.6 trillion won. The increase is attributed to 6.7 trillion won from fiscal measures, 2 trillion won from early redemption of government bonds, 800 billion won from public funds, and 500 billion won from the maturity of fund adjustment deposits. The decrease factors include 1.1 trillion won from other revenues, 1 trillion won from foreign currency bonds, and 500 billion won from fund adjustment deposits. The increase factors exceed the decrease factors by 7.4 trillion won, leading to a positive cash flow on a daily basis. Fiscal execution and the inflow of public funds increase market liquidity, while revenues and foreign currency bond payments shift bank funds to the government sector, reducing reserves. In the call market, reserves are expected to turn positive, but during the weekend, a reduction in reserves may lead to funding demands from some commercial banks. In the repo market, the inflow of public funds is expected to complement existing liquidity, indicating no issues in absorbing sell orders. On the previous trading day, the 21st, there was a continued shortage of reserves, with a deficit of 5.778 trillion won. The short-term money market on this day reflects the transition of reserves to positive and the expected reduction in deficits after the weekend.

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