Pedestrians walk past a logo of the Asian Development Bank (ADB) displayed outside its headquarters in Manila, Philippines on Sept 2, 2010. (TED ALJIBE / AFP)

MANILA - China continues to have the largest local currency bond market in emerging East Asia, comprising 77.8 percent of the region's bonds outstanding, according to the latest issue of the Asian Development Bank (ADB) report released on Friday.

The ADB's Asia Bond Monitor said during the first quarter of 2021 the bond market in China expanded by 2.1 percent from the previous quarter and by 17.3 percent from a year earlier, to US$15.8 trillion dollars, adding that a decline in government bond issuance limited the overall market's growth.

The report said that government bonds in China grew by 1.6 percent from the previous quarter and by 18.5 percent from a year earlier to US$10.1 trillion at the end of March

"A reduced need for fiscal stimulus amid the economic recovery, along with the government's focus on mitigating credit risk in financial markets, limited the issuance of government bonds," the report reads.

The report said that government bonds in China grew by 1.6 percent from the previous quarter and by 18.5 percent from a year earlier to US$10.1 trillion at the end of March.

Corporate bonds increased by 2.9 percent from the previous quarter and by 15.2 percent from a year earlier to US$5.7 trillion, it added.

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Emerging East Asia comprises China, China's Hong Kong, Indonesia, South Korea, Malaysia, the Philippines, Singapore, Thailand and Vietnam.