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Emerging East Asian Local Currency Bond Markets: A Regional Update

Issue: November 2025

Emerging East Asia’s financial conditions remained broadly stable between 1 September and 31 October amid balanced risk factors, according to the Asia Bond Monitor November 2025. Reduced uncertainty following trade agreements with the United States (US), continued US monetary easing, and sound regional economic fundamentals cushioned against lingering global risks. The region recorded equity market gains, equity and bond portfolio inflows, and narrowed risk premiums, while local currencies weakened against the dollar amid US monetary policy uncertainty. Outstanding local currency bonds expanded 3.2% quarter-on-quarter (q-o-q) to reach USD29.5 trillion  at the end of September, driven by USD3.2 trillion of new issuance on 3.5% q-o-q growth. ASEAN+3’s sustainable bonds outstanding rose 3.9% q-o-q to reach USD994.4 billion, led by expansions in ASEAN markets. This edition includes analysis on (i) geopolitical risks and capital flow volatility; (ii) bond market depth and monetary policy transmission; and (iii) ESG investing and systemic banking risks.

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• Download the full report.
  
• Executive Summary
  
• Developments in Regional Financial Conditions
  
• Bond Market Developments in the Third Quarter of 2025
  
• Recent Developments in ASEAN+3 Sustainable Bond Markets
  
• Policy and Regulatory Developments
  
• Risk Spillovers Between Carbon and Green Bond Markets: Implications for the Republic of Korea's Carbon Market
  
• Market Summaries