An Econometric Way To Analyze Development Of Asian Bond Market

To develop Asian bond market is important to reduce excessive dependence on banking system, keep away from financial crisis, and eliminate both currency and maturity mismatch. Generally, regional bond market cooperation accords with economic integration. A deep and sizable regional bond market will create scale effect and help transfer saving and foreign reserve into investment.However, the development of Asian bond market is now facing many problems. With detailed study of cooperation proceeding and feasibility of Asian bond market, firstly this paper analyze effects of different capital flow to economy in order to demonstrate the contribution of foreign bond investment and domestic bond investment. Secondly, from the aspect of financing methods, this paper analyzes the contribution of foreign bond financing and local bond financing to economy development. At last, the paper calculates the volatility of different capital flow to indicate the stability of bond investment.Based on the study mentioned above, it concludes with taking priority to develop domestic bond market, strengthen local currency bond issuing, control foreign bond issuing and push bond investment under the capital account.