Determinants of Local Currency Bonds and Foreign Holdings: Implications for Bond Market Development in the People’s Republic of China
This case study explores which variables—macroeconomic, institutional, and capital controls—are most important in explaining cross-country differences in bond market development. It uses the ratio of amount of local currency bonds outstanding over GDP as a measure of bond market development from 43 countries during 1990–2009. The study examines government and corporate bond markets separately, as the characteristics of these markets are substantially different and requires separate examination. Main findings are derived from the comparative analysis. Several policy implications drawn from the findings are pertinent to the People‘s Republic of China (PRC) bond market. The most important implication is that the way to develop fixed income markets is to start with the government bond market. Another important implication from the empirical findings is that mature and well-developed banking sector is critically important to the further development of bond market, particularly to the corporate bond market. While the PRC bond market has developed significantly over recent years, there is much room for improvement. This report provides policy suggestions, albeit not necessarily from empirical findings, to further develop PRC bond markets.
|Date of creation:||01 May 2012|
|Contact details of provider:|| Postal: P.O. Box 789, Manila|
Fax: (63-2) 636-2648
Web page: http://www.adb.org
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:ris:adbrei:0097. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ivan B. de Leon)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.