A large, liquid and integrated money market was created after 1 January 1999. The euro bond market quickly turned into the second largest bond market in the world. Within the euro area, the elimination of exchange rate risks and the lower transaction costs which followed have created new opportunities for businesses, thereby being conducive to a more efficient allocation of capital.
Although the global financial markets appear to have stabilized, the full impact of the US subprime mortgage market woes has yet to be felt. This could affect the Philippines in two ways. First, growth in the export sector could soften as the US economy, a major trading  BIS Review 16/2008  1  partner of the Philippines, slows down.