Consolidating public debt markets asia

22-Jan-2016 06:43

Public debt became a trusted tool of political economy and financed expenditure in place of levying unpopular taxes.

In the main European cities, government bonds became freely marketable.

The State started borrowing in the Middle Ages in Europe.

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This agreement paved the way for funding the fiscal deficit of Go I through market loans and thereby, need to develop the Government bonds market.

Therefore, State, and by State I mean both the government and central bank, has an interest in developing debt markets.

In pursuit of this interest, the state has a critical role to play in fostering a sound and diversified debt market, which efficiently performs the function of financial intermediation.

The increased role of the State in the financial markets and, particularly, in the debt markets was evident across several countries during the recent global financial crisis and European sovereign debt crisis.

For example, in the backdrop of heightened volatility and dysfunctional of collateral markets, the central banks bought large scale assets (government bonds, corporate bonds, securitized bonds, etc) to calm down the markets and bring back normalcy. A survey of the world's major developed bond markets reveals diverse paths of development.

This agreement paved the way for funding the fiscal deficit of Go I through market loans and thereby, need to develop the Government bonds market.

Therefore, State, and by State I mean both the government and central bank, has an interest in developing debt markets.

In pursuit of this interest, the state has a critical role to play in fostering a sound and diversified debt market, which efficiently performs the function of financial intermediation.

The increased role of the State in the financial markets and, particularly, in the debt markets was evident across several countries during the recent global financial crisis and European sovereign debt crisis.

For example, in the backdrop of heightened volatility and dysfunctional of collateral markets, the central banks bought large scale assets (government bonds, corporate bonds, securitized bonds, etc) to calm down the markets and bring back normalcy. A survey of the world's major developed bond markets reveals diverse paths of development.

The main features of a well developed debt market are depth, breadth, resilience and wide choice of instruments to cater to the requirements of market participants.