Asia Bond Monitor - October 2010
The Asia Bond Monitor reviews recent developments in East Asian local currency bond markets along with the outlook, risks, and policy options. This issue includes developments in the corporate bond market.
Concerns have been mounting that the global economic recovery and stabilization of world financial markets, which has been underway since the last half of 2009, may stutter as vulnerabilities persist in the mature economies.
Emerging East Asian1 economies have thus far not been significantly impacted by the sovereign debt crisis in Europe or concerns about the pace of recovery in the United States. Flush liquidity in global markets and higher returns in emerging East Asia’s local markets is attracting capital inflows.
Some of the highlights in this issue include:
- Emerging East Asia’s local currency (LCY) bond market in 2Q10 grew at a rapid rate of 18.8% year-on-year (y-o-y) in 2Q10 and 5.1% quarteron-quarter (q-o-q).
- The government bond market grew by 16.7% y-o-y in 2Q10, while the corporate bond market grew at a more rapid rate of 24.4% y-o-y. The q-o-q growth rates of the government and corporate bond markets were almost identical at 5.1% and 5.0%, respectively.
- Emerging East Asia’s most rapidly growing LCY corporate bond markets in 2Q10 were in Viet Nam, the People’s Republic of China (PRC), the Philippines, and Indonesia.
- Foreign currency bond issuance from the region remained on track to equal—or even exceed—the $63.2 billion of new issuance in 2009. The strong appetite for new G3 currency issuance reflected sustained investor interest in the bonds of major Asian governments, corporations, and financial institutions.
This publication reviews recent developments in East Asian local currency bond markets along with the outlook, risks, and policy options. It covers the 10 members of the Association of Southeast Asian Nations plus the People's Republic of China; Hong Kong, China; and the Republic of Korea.
- Introduction: Global and Regional Market Developments
- Bond Market Developments in the Second Quarter of 2010
- Policy and Regulatory Developments
- Corporate Bond Market Developments
- Market Summaries