South Korea's financial regulator said on Thursday it plans to establish a 20-year government bond futures market by 2015 to boost derivatives trading activity and offer investors' more hedging options.
The Financial Services Commission (FSC), in an annual report to the president, said a greater variety of derivatives products will offer investors the ability to properly manage their investment risks.

This measure comes as the South Korean government seeks to increase the proportion of longer-term debt to reduce potential refinancing risks and meet demand from institutional investors for such products. A futures contract for longer-tenored debt would help investors cope with risks associated with the less liquid paper.

The FSC also said it will closely monitor a recent spike in yuan-denominated deposits and any similar trends involving other foreign currencies for potential risks.

Yuan deposits by South Korean residents jumped nearly nine-fold between September to January as investors searching for higher yields invested in short-term, asset-backed commercial paper that results in simulated yuan deposits in local branches of Chinese banks via currency swaps.

Bank of Korea Governor Kim Choong-soo said last week that the spike in yuan deposits was not a major cause for concern, and policymakers have so far ruled out any change in regulation to curb the yuan deposit growth.

Finally, the FSC said it plans to announce additional measures to manage household debt conditions by end-February. Though it did not disclose specifics, new measures will add to existing debt restructuring efforts such as boosting the amount of longer-term and amortising home mortgages to push borrowers towards more financially sound loans. (Reporting by Se Young Lee; Editing by Kim Coghill)

THEY sit behind the scenes pulling the strings, but you probably don't even know they exist. 

Officials at the US Federal Reserve hold confidential meetings eight times a year where they pore over economic data from business confidence to building approvals to gauge how the economy is tracking.
What they decide determines monetary policy for the $17 trillion US economy and can trigger changes in interest rates, foreign exchange rates, employment and the price of goods around the world.
Now, with Janet Yellen at the helm - the first female in their 100 year history - the Fed is about to start winding back stimulus measures which could have a massive impact on Australian markets, including everything from how much your mortgage costs to where you go on holiday.
Confused? This is how it works.
The Federal Reserve, as the central bank that regulates the world's biggest economy, is the linchpin of the global financial system.
It's run by a Board of Governors and Federal Open Market Committee (FOMC) responsible for setting monetary policy in the US covering everything from lending rates to reserve requirements and regulation of the banking system.
Their huge scope means what they do impacts every other financial market in the world, ensuring economists hang on their every word and traders make or lose billions by their decisions.
Westpac economist Elliot Clarke said the Fed is the bedrock of the global financial system and their decisions are "very very important" for the Australian economy.
"They're considered a baseline for markets, it's up to market economists to add more colour," he said.
So who are they?

The FOMC is usually made up of 12 people, including seven from the Board of Governors and five from Federal Reserve banks around the country. But at the moment there are just 10 people due to vacancies in certain seats.

These are the 10 members of the FOMC for 2014
• Janet L. Yellen, Board of Governors, Chair: Former economics professor who previously served as vice chair under Bernanke and is said to be keen to tackle unemployment.
• Jerome H. Powell, Board of Governors: Has a law degree and once served as assistant secretary and undersecretary of the treasury for George Bush.
• Sarah Bloom Raskin, Board of Governors: Took office in 2010 after serving as commissioner of financial regulation in Maryland.
• Jeremy C. Stein, Board of Governors: Former Harvard economics professor who has previously been secretary of the treasury and on staff at National Economics Council.
• Daniel K. Tarullo, Board of Governors: Law professor who was President Clinton's assistant on international economic policy.
• William C. Dudley: Sits on the FOMC permanently as president of New York Federal Reserve and was previously managing partner and economist at Goldman Sachs.
• Richard W. Fisher: President of Dallas Reserve Bank who grew up in Mexico and started his own companies before selling controlling interests when he went into government.
• Narayana Kocherlakota: Baltimore native who was economics professor and research economist at Reserve Bank of Minneapolis before rising to become president.
• Sandra Pianalto: Italian-born economist started out as in the research department in 1983 and rose to become boss at the Reserve Bank of Cleveland.
• Charles I. Plosser: Former Stanford professor who worked as a consultant to high profile companies and banks before becoming President of Reserve Bank of Philadelphia.

What's it to me?
Janet Yellen takes the helm at perhaps the trickiest time in the Federal Reserve's history.
Since the financial crisis, the central bank has embarked on three distinct phases of "quantitative easing," a program of purchasing treasury bonds and mortgage backed securities designed to help the US economy recover its strength.
The last phase, known as Operation Twist, began in September 2011 has seen the Fed provide $85 billion worth of stimulus every month from January to November 2013. However they're now looking to wind this back, dropping it to $75 billion in December 2013 and $65 billion in January 2014.

Mr Clarke said the Fed expects to reduce this by $10 billion a month until the economy can stand on its own two feet, relying on "incomes and regular activity drive the economy rather than just excess liquidity."
The impact in Australia depends on how things pan out, but Mr Clarke said the main thing markets don't like is uncertainty.
"Any data and decision within expectations doesn't tend to impact markets all that much. What is actually a contractual shift in policy can be seen as a positive. It really is to do with market psyche and how this expectations or piece of data impacts markets going forward," he said.
However as the Fed is essentially turning off the money tap and hoping for the best, there is a major risk it won't proceed as expected.
"Our general concern is its [the US economy] is not as strong as people make it out to be. There is a risk that the Fed won't be able to continue to taper and markets might react in a different way, we might actually see a much more prolonged period of tapering," he said, which would mean the Aussie dollar remaining at current levels.

"Our purchasing power would actually be staying around the same level rather than deteriorating. That's a positive for Australian consumers."
However this could provide a risk to markets, where fears over US growth have a negative impact.
"Concerns over the US growth trajectory gets market participants scared and they tend to want to reduce their exposure to risk which means they sell equities," he said.
"It's just really all about market expectations and how they relate to the data we see. Without those that factors you're likely to see continuation in a range around the current level."