Exploring the Role of Foreign Investors in Russia's Local Currency Government Bond (OFZ) Market

February 10, 2017

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Yinqiu Lu, and Dmitry Yakovlev. Exploring the Role of Foreign Investors in Russia's Local Currency Government Bond (OFZ) Market, (USA: International Monetary Fund, 2017) accessed September 19, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Local currency government bonds (OFZ bonds) are an important fixed-income instrument in Russia’s financial markets. In this paper, based on granular data, we explore the development of the OFZ bond market with a focus on foreign investors. As this fixed-income market has experienced a liberalization of the domestic trading and settlement infrastructure, and weathered several episodes of market stresses since the 2008–09 global financial crisis, the role of foreign investors can be observed along with these events. What we have found is that foreign investors had influenced the market before they became an important player and since then they have contributed to the development of the market while not necessarily destabilizing it in episodes of shocks.

Subject: Bonds, Correspondent banking, Financial institutions, Financial markets, Financial services, Securities markets, Sovereign bonds, Yield curve

Keywords: Bonds, Correspondent banking, Debut OFZ linker, Financial market development, Foreign investor, Global, Investor base, Local currency government bonds, OFZ bond, OFZ bond risk, OFZ market operator, OFZ yield, Russia, Secondary market, Securities markets, Sovereign bonds, WP, Yield curve

Publication Details

Pages:

37
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2017/028
Stock No:

WPIEA2017028
ISBN:

9781475577587
ISSN:

1018-5941

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