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Global issuance of green bonds is forecast to grow by 20% in the year ahead, topping US$200 billion, according to a new report from Moody’s Investors Service.

The rating agency says it sees a number of factors boosting the green bond market in 2019, including strong investor demand, a growing emphasis on sustainability, increasing harmonization of global green bond standards and environmental impact reporting, and an increase in repeat green bond issuers.

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As a result, Moody’s predicts that global green bond issuance will rise by 20% this year, after growing by just 6% in 2018.

This growth in issuance will be accompanied by continued diversification in the fixed income products, Moody’s says. “Originally dominated by the supranational development banks, the green bond market has become increasingly diverse in terms of sector, region and use of proceeds,” it says, adding that this sort of diversification, “will help the market mature over time.”

Additionally, Moody’s says, increasing harmonization in global green bond standards may help spur market growth. “Market participants are increasingly expressing the need for a globally consistent green bond standard to maintain and accelerate long-term market growth,” it says. “Work currently underway from the European Commission to create a sustainable finance standard … may be an important step down this path.”