There are several aspects to this development, from specific bond market growth initiatives and an increase in issuance to deeper liquidity and growing foreign investor participation.
Asian bonds may still be a pupil in the broader Emerging Market (EM) asset class, but they are far from a monolithic entity. While some markets, such as China and Indonesia, are often referred to as EM, others like Korea, Hong Kong and Singapore are commonly considered Developed Markets (DM). As such, Asian fixed income possesses both EM and DM characteristics — but in many ways, it has already pulled ahead of many of its contemporaries and may soon graduate from the EM school.
In historical terms, 15 years is not an especially long time, but for the local currency (LC) bond markets, that is sufficient time for them to develop and mature into an asset class that is giving rise to new opportunities — and increasingly drawing attention from investors.
