China's Bond Market and Global Financial Markets

18 Pages Posted: 14 Jan 2019

See all articles by Eugenio Cerutti

Eugenio Cerutti

International Monetary Fund (IMF); Johns Hopkins University

Maurice Obstfeld

International Monetary Fund (IMF)

Date Written: December 2018


A cross-country comparative analysis shows that there is substantial room for further integration of China into global financial markets, especially in the case of the international bond market. A further successful liberalization of the Chinese bond market would encompass not only loosening bond market regulations, but also further developing of other markets, notably the foreign exchange market. Even though the increased integration of China into international capital markets would increase its exposure to the global financial cycle, the costs in terms of monetary autonomy would not be large given China's size and especially under a well-articulated macroeconomic framework.

Keywords: Globalization, Asia and Pacific, China, International financial markets, Bond Market, Market Integration, Financial Aspects of Economic Integration, International Business Cycles

JEL Classification: F36, F44, G15

Suggested Citation

Cerutti, Eugenio and Obstfeld, Maurice, China's Bond Market and Global Financial Markets (December 2018). IMF Working Paper No. 18/253, Available at SSRN:

Eugenio Cerutti (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street N.W.
Washington, DC 20431
United States

Johns Hopkins University ( email )

Baltimore, MD 21218
United States

Maurice Obstfeld

International Monetary Fund (IMF) ( email )

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