ADB: Emerging East Asia bond markets continue growth despite risks
Emerging East Asia’s local currency bond market expanded steadily in the second quarter of 2019 despite downside risks stemming from ongoing trade conflicts, a faster-than-expected economic slowdown in China, and moderating global growth, according to the latest issue of the Asian Development Bank’s Asia Bond Monitor.
“Foreign investment in emerging East Asia remains stable but there are still considerable potential risks. Financial stability in the region could be undermined if global investors change their views on emerging markets,” said ADB Chief Economist Yasuyuki Sawada.
“Governments in the region would do well to continue to deepen local currency bond markets so they can act as a reliable local source of funding.”
At the end of June, there was $15.3 trillion in local currency bonds outstanding in the region, 3.5% more than at the end of March and 14.2% more than in June 2018. Bond issuance in emerging East Asia amounted to $1.6 trillion in the second quarter, 12.2% higher than in the first quarter.
