Impact of Russia-Ukraine war on the hierarchical structure of government bond markets

The current study investigates the impact of Russia-Ukraine war on topological properties of the international bond market by adopting econophysics methodologies, namely hierarchical structure methods (minimal spanning tree, (MST) and hierarchical tree, (HT)). We examine the network structure in bond markets by using daily data for 10-years government bond yields for 25 developed and developing economies including European countries as well as countries with largest bond market such as the United States, China, and Japan. We have also concentrated the co-movements among European Union (EU) member countries since most of them adopt the euro as common currency while few still use their local currency as an official currency. Our sample covers the period from beginning of January, 2015 to the end of August, 2022, which also include the Russia-Ukraine war. Hence, we have divided the period into two sub-periods to investigate the influence of Russia-Ukraine war on the structuring and clustering linkages in government bond markets. Our results indicate that the networks of relationships between EU government bond markets, using the Euro as an official currency, are closely connected to each other according to their economic tie. The countries with largest bond markets are not located at the center of the trees. It is also obtaining that the Russia-Ukraine war have affected network structure of the government bond markets. GRAPHICAL ABSTRACT: [Image: see text]