A Framework for Developing Secondary Markets for Government Securities
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Summary:
This paper consolidates previous work on the development of secondary markets for government securities, and focuses on the sequencing of measures necessary for their development. Six main lessons are identified: (i) a commitment to achieving and maintaining a stable macroeconomic environment, especially prudent fiscal policy, should underpin market development; (ii) a sound and transparent public debt management strategy supports secondary market activity; (iii) a deep and diverse investor base is required; (iv) poor market infrastructure leads to high transaction costs, slow order execution, and excessive operational risk, which all inhibit trading; (v) secondary market growth is facilitated by effective monetary policy implementation; and (vi) reforms should be sequenced to ensure even development of all the structures supporting the secondary market.
Series:
Working Paper No. 2008/174
Subject:
Government debt management Government securities Public debt Securities Securities markets
Frequency:
Quarterly
English
Publication Date:
July 1, 2008
ISBN/ISSN:
9781451870329/1018-5941
Stock No:
WPIEA2008174
Pages:
55
Please address any questions about this title to publications@imf.org