Economics Bonds Questions
The role of bond auctions in the bond market is to facilitate the issuance of new bonds by governments or corporations. These auctions allow these entities to raise funds by selling bonds to investors. The auction process determines the interest rate or yield at which the bonds will be sold, based on the demand and supply dynamics in the market. Bond auctions also provide transparency and price discovery, as they allow market participants to assess the prevailing market interest rates and investor sentiment.