Developing the Secondary Fixed Income Market

The development of debt markets in Thailand has a strong potential to become one of the main pillars for Thailand's financial structure. With the ultimate goal of having a more sustainable financial system, Thailand's bond market has been developed significantly during the past few years. This has been witnessed by consistent issuance of both government and corporate securities.

However, a large primary market issuance of government bonds in itself does not mean that a market is well developed. A deep and liquid market requires efficient trading of bonds in the secondary market where bondholders can easily liquidate their bond holdings any time they wish. An efficient secondary market is an integral part of the price discovery process where both issuers and borrowers are confident of a fair market price. Moreover, an active secondary market enables the Bank of Thailand to conduct Open Market Operations more efficiently.