Regional Pull vs Global Push Factors : China and US Influence on Asia-Pacific Financial Markets

This paper compares spillovers from the US and Chinese financial markets to the rest of Asia-Pacific. Structural VAR analysis points to the growing influence of Chinese equities and currency movements. In normal times China's influence in the equity market has risen to a level close to that of the United States, although the relative impact of the United States became stronger in crisis periods. Nonetheless, China's bond market remains a negligible player. The influence of China may be interpreted as a "regional pull" factor, while that of the United States remains a key "global push" factor