Financial Market Trends

OECD’s twice-yearly journal providing timely analyses and statistics on financial matters of topical interest and longer-term developments in specific financial sectors. Each issue provides a brief update of trends and prospects in the international and major domestic financial markets along with articles covering such topics as structural and regulatory developments in OECD financial systems, trends in foreign direct investment, trends in privatization, and financial sector statistics covering areas such as bank profitability, insurance, and institutional investors.

Periodically, a small number of articles within one field of financial sector developments – constituting the so-called special focus for the particular issue – may be included.


Pension Fund Demand for High-quality Long-term Bonds

Quantifying Potential “Scarcity” of Suitable Investments

The article describes the results of a modeling exercise to gauge the size of potential pension fund demand for bonds under some simplifying assumptions, so as to illustrate the potential role of this specific group of investors. It provides a measure of the potential excess demand for high-quality fixed-income instruments from pension funds, using the admittedly restrictive assumptions that pension funds invest only in high-quality bonds in an attempt to achieve cash-flow matching of their liabilities.


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