Hong Kong Exchanges and Clearing Limited (HKEX) today announced plans to launch China Treasury Bond Futures in Hong Kong, subject to regulatory approval.
HKEX CEO Nicolas Aguzin said:
“These unique new bond futures will help increase market liquidity and support the further development of Hong Kong’s RMB ecosystem, strengthening the city’s role as the world’s leading offshore RMB hub. We look forward to working closely with the Securities and Futures Commission and all our partners to ensure the successful development of this exciting new risk management tool as we connect China to the world.”
The introduction of bond futures, part of HKEX’s RMB and China product ecosystem that includes MSCI China A50 Connect Index Futures and Swap Connect, will help regional and global investors interested in gaining access to China to more effectively manage interest rate risks and investments. This will support greater international participation in China’s equity and fixed income markets and further expand investment and risk management opportunities in the Hong Kong markets.
The launch of Bond Connect in 2017, part of HKEX’s unique mutual market access program with mainland China, was a major development in promoting international participation in China’s bond market, while Swap Connect, which launched in May this year year, allows international investors to tap into the onshore RMB interest rate swap market. Onshore bonds of international investors in Mainland China increased steadily from RMB 0.8 trillion in June 2017 to RMB 3.33 trillion in June 2023.
HKEX is now undertaking related preparations in view of the release of the SME Government Bonds.