Description

We investigate the extent of regional financial integration in the member countries of the Gulf Cooperation Council. The limited volume data available suggests that regional integration is non-negligible. Bahrain and Kuwait investments especially are oriented towards the region. The development of stock markets in the region will also improve the extent of financial integration. Interest rate data shows that convergence exists and that interest rate differentials are relatively short-lived-especially compared to the ECCU, another emerging market region sharing a common currency. Equities data using cross-listed stocks confirms that stock markets are fairly integrated compared to other emerging market regions, although financial integration is hampered by market illiquidity.

Taxonomy

Asset prices , Capital markets , Cooperation Council for the Arab States of the Gulf , Economic cooperation , Economic policy , Financial institutions and markets , International organizations , Monetary policy , Monetary unions

More publications in this series: Working Papers

More publications by: Raphael A. Espinoza ; Ananthakrishnan Prasad ; Oral Williams