Asia Bond Monitor Series

Emerging East Asia’s financial markets have been stable on the back of strong global economic growth but potential risks include a further tightening of global liquidity.

On the back of a brightening global outlook, government bond yields in major advanced economies rose between 1 June and 15 August, with the increase extending to emerging East Asia.

Continued improvement in global economic prospects helped drive yields lower in most markets in emerging East Asia amid positive investor sentiment.

Yields in advanced economies rose while yields fell in most emerging East Asian bond markets due to heterogeneous economic fundamentals and changes in risk appetite.

Emerging East Asian bond yields rose for nearly all markets and for most tenors between 31 October and 18 November amid uncertainty over future US economic policy and the likelihood of a Federal Reserve rate hike in December.

Yields on bonds in emerging East Asian markets declined as inflationary pressures remained largely muted and persistently low global growth increased the attractiveness of East Asian bonds.

Bond yields in most emerging East Asian markets fell between 1 March and 15 May amid a weak global economy. The exceptions were the People’s Republic of China (PRC) and the Philippines, where yields generally picked up.

Bond yields in most emerging East Asian markets declined amid mounting gloom over global growth prospects. The main exceptions to the downward trend were the People’s Republic of China (PRC) and Hong Kong, China.

This issue reviews recent developments in East Asian local currency bond markets along with the outlook, risks, and policy options. It also includes the results of the AsianBondsOnline bond market liquidity survey.

The publication reviews recent developments in East Asian local currency bond markets along with the outlook, risks, and policy options. This issue includes a special section on Sukuk (Islamic bonds) Developments in Emerging East Asia.