Local currency government bond yields trended lower in nearly all markets in emerging East Asia between 1 June and 15 August amid weakening global growth outlook, easing monetary policy stances, and investor risk aversion, according to the latest issue of the Asia Bond Monitor. Despite downside risks to economic prospects and financial stability, the region’s local currency bond market expanded steadily to reach a size of USD15.3 trillion at the end of June.
Good Practices For Developing a Local Currency Bond Market: Lessons from ASEAN+3 Asian Bond Markets Initiative
This report shares the experiences of ASEAN+3 and provides a comprehensive picture on fostering a local currency bond market. Although every market is unique, some lessons from the region's varied experiences could still be drawn on how to expedite the process of bond market development in a developing economy.
The Philippines’ exports inched up 0.6% year-on-year (y-o-y) in August to USD6.2 billion and posted a trade deficit of USD2.4 billion. Japan’s producer prices were unchanged on a month-on-month (m-o-m) basis in September after falling 0.3% m-o-m in August. The zero inflation was largely driven by declines in electric, power, gas, and water prices offsetting the increases in agriculture, forestry, and fishery products and metal products. The Index of Industrial Production in Malaysia extended its growth in August to 1.9% y-o-y after rising 1.2% y-o-y in July. On a m-o-m basis, Malaysia’s Index of Industrial Production increased 0.9%. Japan’s current account balance rose 18.3% y-o-y in August to JPY2,157.7 billon due to the trade balance returning to a surplus of JPY50.9 billion, reversing a JPY1,823.7 billion deficit in August 2018. The Republic of Korea’s current account surplus narrowed to USD5.3 billion in August from USD6.9 billion in July.
Notes: 1. CN=People's Republic of China; HK=Hong Kong,China; ID=Indonesia; KR=Republic of Korea; MY=Malaysia; PH=Philippines; SG=Singapore; TH=Thailand; VN=Viet Nam; VN*=Viet Nam (MOF data). 2. Data as of end-June 2019.
Notes: A positive (negative) value for the foreign exchange rate indicates the appreciation (depreciation) of the local currency against the United States dollar.
Asia Bond Monitor
The Asia Bond Monitor (ABM) is AsianBondOnline's quarterly publication released every March, June, September, and November. The report reviews recent developments in East Asian local currency bond markets along with the outlook, risks, and policy options. The ABM covers the 10 Association of Southeast Asian Nations member countries and the People's Republic of China; Hong Kong, China; and the Republic of Korea.
The Weekly Debt Highlights Report provides a summary of the relevant key macroeconomic data and monetary policy updates released in the previous week in the various economies covered by ABO. The report also includes select government and corporate debt issuances, credit rating updates, and other relevant regulatory developments. The report is published every Monday.
The ABO Monthly Debt Roundup provides a snapshot on changes in financial prices such as foreign exchange, yields, equity as well as recent monetary policy rate movements in the region. In addition, the ABO Monthly Debt Roundup provides data on foreign investor bond flows of local currency government bonds for the PRC, Indonesia, Malaysia, the Philippines and Thailand.
The ASEAN+3 Bond Market Guide is a series published by the ASEAN+3 Bond Market Forum in collaboration with ADB as its secretariat. Each country-specific guide provides information on the investment climate, rules, laws, opportunities, and characteristics of the local bond market. The guides are produced in close consultation with local policymakers and market players.
The AsianBondsOnline web portal is an ASEAN+3 Initiative supported by the Asian Development Bank and funded by the Ministry of Finance Japan, through the Investment Climate Facilitation Fund.