European Parliament Library

Real Money Investors and Sovereign Bond Yields, Laura Jaramillo, Yuanyan Zhang

Experience from the global financial crisis suggests that countries’ borrowing costs are not solely determined by macro and fiscal fundamentals. Factors such as ownership structures of government securities, among others, also play a significant role. This paper investigates the effect of “real money investors”—domestic nonbanks and national and foreign central banks—on bond yields for a sample of 45 advanced and emerging market economies. The results show that, while bond yields rise with the debt to GDP ratio, this increase is partly offset if this debt falls in the hands of real money investors. Nonetheless, for some countries there is the risk that such ownership structure could change over the long run, which would impose upward pressure on borrowing costs, especially where fiscal positions are weak
Table Of Contents
Cover; Abstract; Contents; I. Introduction; II. Literature Review; III. Stylized Facts; Figures; 1. Fiscal Indicators and Sovereign Bond Yields, 2008-2012; 2. Real Money Investors and Sovereign Bond Yields, 2008-2012; 3. Investor Base, 2012; 4. Investor Base by Region, 2004-2012; 5. Real Money Investors, 2007; IV. Empirical Model Specification; V. Data and Methodology; A. Data Sources; B. Results and Policy Implications; VI. Summary and Conclusions; Table; 1. Determinants of Sovereign Bond Yields; References
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (25 p.)
Specific Material Designation
Form Of Item

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