Bond markets are financial markets where participants can buy and sell bonds, which are debt securities issued by entities like governments or corporations. When investors purchase a bond, they are essentially lending money to the issuer in exchange for periodic interest payments and the return of the bond's face value at maturity. These markets play a crucial role in the economy by providing a way for issuers to raise capital for various projects and for investors to earn returns. The performance of bond markets is often influenced by factors such as interest rates, inflation, and economic conditions, making them an important indicator of overall financial health.