Economic commentary: The development of the Swedish market for corporate bonds
Date
15/10/2014
The Swedish market for corporate bonds is growing and there are strong indications that it will continue to grow in the period ahead. In addition, the structure of the market has changed in recent years. These changes include the establishment of marketplaces. As the market grows and its structure changes, its role in the financial system and for financial stability is becoming increasingly important.
The outstanding volume of corporate bonds and the number of companies issuing bonds has grown noticeably in recent years. The share of high-yield bonds or bonds without credit ratings has also increased. The increased supply from companies has been met by increased demand from investors.
The low interest rate environment and the strengthened structure of the market are expected to have a positive effect on future development. The new financial regulations now being introduced will also have an impact on the development of the market. However, at present, it is difficult to say what the final effects of the regulations may be.
This Economic Commentary describes the development of the Swedish market for corporate bonds and the initiatives taken to develop the market further. This is followed by a discussion of financial regulations that may be significant for the development of the market. Finally, it discusses how the market may develop in the future.
Read the Economic Commentary here.
By Fredrik Bonthron
The author works in the Financial Stability Department of the Riksbank.
