This chapter is concerned not with the general determinants of interest rates but with the special features determining interest rates in the eurobond market (a full treatment of interest rate theory can be found in for example Conard).1 The approach taken will be based on loanable funds theory, as liquidity preference theory does not seem particularly appropriate in this particular market in which the reasons for investment differ greatly from those in a conventional national market, as explained below.
KeywordsInterest Rate Domestic Market International Bond Secondary Market Yield Differential
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