New Measures to support development of Hong Kong's fixed income and currency market and offshore Renminbi business
The following is issued on behalf of the Hong Kong Monetary Authority:
The Hong Kong Monetary Authority, Photo source: reference image
The Hong Kong Monetary Authority (HKMA), the People's Bank of China (PBoC) and the Securities and Futures Commission (SFC) announced today (July 7) a series of new measures to deepen the financial co-operation between Hong Kong and the Chinese Mainland, support the development of Hong Kong's fixed income and currency (FIC) market and offshore Renminbi (RMB) business, and reinforce Hong Kong's position as an international financial centre. These measures include:
- supporting the collaboration of financial infrastructure institutions in Hong Kong and Chinese Mainland to develop a Hong Kong FIC electronic trading platform;
- further enhancing and expanding the Southbound Bond Connect, including increasing the annual investment quota, developing bond repurchase (repo) business using Southbound Bond Connect bonds as collateral, expanding the product scope to cover products with HKD bonds and RMB bonds as underlying assets, connecting to the Macao bond market, and enhancing the management of Southbound Bond Connect market makers;
- supporting the inclusion of onshore bonds issued by the Ministry of Finance and Mainland policy banks that are held under Northbound Bond Connect as eligible margin collateral at the HKFE Clearing Corporation and the SEHK Options Clearing House;
- enhancing the Northbound Bond Connect operational arrangement to extend the settlement time and improve efficiency;
- further enhancing the Swap Connect to include the interbank Seven-Day Fixing Depository-Institutions Repo Rate (FDR007) as a reference rate; and
- supporting the launch of Hong Kong Exchanges and Clearing Limited Five-Year China Government Bond Futures in Hong Kong on August 3.
The People's Bank of China, Photo source: reference image
Building on this, the HKMA also announced five measures to support the development of the offshore RMB market and strengthen Hong Kong's role as a leading offshore RMB business hub, thereby enabling greater outreach to other regions and enhancing support for the real economy. These measures, underpinned by strong support from the PBoC, address industry suggestions for developing the offshore RMB market. These include:
- increasing the size of the HKMA's RMB Business Facility from RMB200 billion to RMB500 billion and extending tenors to include nine-month, two-year and three-year, effective on July 10;
- exploring to introduce a tendering mechanism of seven-day offshore RMB liquidity;
- exploring the issuance of offshore RMB short-term debt instruments to support the building of the offshore RMB yield curve;
- promoting the development of a bilateral currency transaction framework between Indonesian Rupiah and offshore RMB; and
- issuing good practices to banks to promote RMB adoption.
The Chief Executive of the HKMA, Mr Eddie Yue, said, "We are pleased to announce this series of measures, which will further deepen cross-boundary financial co-operation, strengthen financial market connectivity between Hong Kong and the Chinese Mainland, promote the development of Hong Kong's fixed income and currency market, and reinforce Hong Kong's position as an offshore RMB business hub and international financial centre. These measures are the result of concerted efforts of the HKMA, the PBoC and other relevant financial regulatory authorities in Hong Kong and on the Chinese Mainland. We will continue to work closely with the relevant regulatory authorities, the industry and financial infrastructure institutions to ensure timely and smooth implementation of the measures, and explore further enhancements."
The Securities and Futures Commission, Photo source: reference image
Speech by FS at Hong Kong FIC & Bond Connect Summit
Following is the speech by the Financial Secretary, Mr Paul Chan, at the Hong Kong FIC & Bond Connect Summit today (July 7):
Kelvin (Chairman of the Securities and Futures Commission (SFC), Dr Kelvin Wong), Eddie (Chief Executive of the Hong Kong Monetary Authority (HKMA), Mr Eddie Yue), Julia (Chief Executive Officer of the SFC, Ms Julia Leung), Bonnie (Chief Executive Officer of the Hong Kong Exchanges and Clearing Limited, Ms Bonnie Chan), distinguished guests, ladies and gentlemen,
Good afternoon. It is a great pleasure to join the FIC and Bond Connect Summit.
Let me begin with a figure. Last year, our interbank clearing system processed HK$105 trillion every month - across Hong Kong dollar, US dollar, renminbi and euro - of which the renminbi accounted for some 48 trillion yuan. What makes this significant is not just the scale, but what it reflects: the distinctive role Hong Kong plays in an increasingly complex global financial landscape. Indeed, capital is searching for fresh opportunities, and currency use is growing more diversified.
That is the context in which we meet today. The FIC market is not simply about products or trading channels. It is part of a bigger market through which capital is priced, allocated and managed across borders. It also shows how Hong Kong continues to connect the Chinese Mainland, Asia and global capital in ways that are efficient, trusted and unique.
I would focus my remarks around three questions. First, how is Hong Kong's FIC market adapting to shifts in global capital allocation? Second, what does Hong Kong distinctively offer international investors? And third, as geopolitics evolves and the international monetary system becomes more multipolar, are we seeing increasing financial fragmentation - or the emergence of new and more sophisticated channels of connectivity?
The FIC Market in Hong Kong
At the heart of this discussion is connectivity. For Hong Kong, connectivity is not a slogan. It is built through markets, infrastructure and trust: an expanding Mainland bond market, an offshore platform for pricing and distribution, and the clearing, currency and risk-management systems that allow capital to move with efficiency and confidence. I will begin with infrastructure, because it is where Hong Kong's relevance is most unique in a more complex geopolitical landscape.
As the world's fourth-largest foreign exchange market, Hong Kong offers the market depth that investors need when raising funds and managing cross-border positions, particularly as the international use of the renminbi continues to broaden.
Last year, over US$133 billion of Asia's international bond issuance was arranged in Hong Kong, accounting for about a quarter of the regional total. Over the past two decades, this market grew at a compound annual rate of around 20 per cent, making Hong Kong Asia's largest international bond-arranging hub.
Increasingly, renminbi financing is part of that success story. Dim sum bond issuance has exceeded RMB1 trillion in each of the past two years, with outstanding stock surpassing RMB1.6 trillion. In 2025, we saw first-time issuances by the Government of Indonesia and the Development Bank of Kazakhstan - and Indonesia is back again this year. International issuers increasingly see Hong Kong as a natural venue for offshore renminbi financing.
The HKSAR Government has a role to play as an issuer and market builder. In May, our multi-currency, multi-tenor green and infrastructure bond issuance attracted investors from more than 30 jurisdictions across Asia, Europe, the Middle East and the Americas, with an order book 8.6 times the issuance size.
On the fintech front, we made early moves in applying tokenisation to government bond issuance. Beyond our own issuances, we are working with the market to develop the broader FIC ecosystem, including the use of tokenisation and distributed ledger technology in the fixed income market. These measures help us build a market that is deeper, more efficient and accessible, and better able to connect Mainland opportunities with global capital.
Hong Kong's Value Proposition
Taken together, the developments above point to Hong Kong's distinctive value proposition. International capital turns to Hong Kong for more than market depth. It's here because Hong Kong offers two things at the same time: an open, trusted and well-regulated platform; and efficient access to the opportunities arising from the Mainland's continued development.
This combination matters even more in the current geoeconomic environment. As investors reassess allocation, liquidity and risk across markets, they look for platforms that are open, stable and predictable. Under the "one country, two systems" framework, Hong Kong continues to give them the confidence they seek.
At the same time, investors are keen to seek exposure to the Chinese Mainland's steady long-term growth and technological innovation. Hong Kong is where that access can be achieved through market practices that international investors understand and trust. Hong Kong is chosen not because of geographic proximity, but our institutional strengths.
Figures in respect of our Connect Schemes speak volumes about this. Today, more than 70 per cent of international investors' A-share holdings were acquired through Stock Connect, and around two-thirds of their Mainland bond holdings were transacted through Bond Connect. These channels have become part of the operating architecture of cross-border investment into China. As liquidity gathers here, it also creates demand for a broader range of products, better risk management tools and deeper links with the Mainland's FIC markets.
This morning, Governor Pan announced a series of important measures to deepen two-way connectivity between Hong Kong and the Mainland. These measures will further widen the channels through which investors can access Mainland assets, allocate capital and manage risk. The HKSAR Government welcomes these initiatives, and the HKMA, the SFC and other relevant authorities will work closely with the market to implement them in a timely manner.
The second part of Hong Kong's value proposition lies in supporting the international use of the renminbi. The country's 15th Five-Year Plan explicitly calls for advancing renminbi internationalisation, and Hong Kong is well placed to contribute to this national strategy. Last year, we published the Fixed Income and Currency Market Development Roadmap, which sets out our vision and action agenda for strengthening primary issuance, deepening secondary-market liquidity, developing offshore renminbi business and building next-generation market infrastructure.
In the context of offshore RMB business, we will work on three fronts: first, enriching the offshore renminbi product ecosystem; second, strengthening the infrastructure that supports clearing, settlement and risk management; and third, deepening liquidity so as to serve investment and financing needs more effectively.
Not a Fragmenting System
Now, on the third question: As the international use of the renminbi expands, are we witnessing the fragmentation of the financial system?
My answer is that we should not confuse diversification with fragmentation. The wider use of different currencies is a natural response to a more multipolar global economy. Countries and companies are looking for more options in clearing, settlement and financing. They seek to reduce concentration risk, to manage external shocks, and to improve cost and efficiency; in other words, to add resilience and optionality to the regime.
The renminbi is an important part of this evolution, given China's role as a major trading and industrial power, and the growing international appetite for Chinese financial assets.
The numbers illustrate the point. China accounts for around 12 per cent of global merchandise trade, yet the renminbi represents only about 4 per cent of global trade settlement and just 2 per cent of global central bank reserves. This does not mean the gap will be closed overnight. But it does suggest that, as market infrastructure deepens and more use cases develop, the renminbi can play a larger role in trade, investment and reserve management.
In other words, the story is not one of substitution, but of complementarity. The US dollar and other established reserve currencies will continue to play important roles. Meanwhile, more economies and market participants will use their own or regional currencies where it makes commercial and financial sense to do so. A more diversified currency system can still be an integrated one, provided that the channels of connectivity remain open, trusted and efficient.
The same logic applies to new payment and settlement infrastructures. CIPS (Cross-border Interbank Payment System), CBDCs (Central Bank Digital Currency), stablecoins and other digital solutions should not be seen simply as alternatives to existing ones. The real question is whether they can make cross-border payments and settlement more open, interoperable, efficient and cheaper. For many emerging markets, particularly those with large remittance flows and SME trade, the practical needs are clear: lower cost, faster processing, greater transparency and less friction in cross-border transactions.
What we are likely to see, therefore, is not the breakdown of the international financial system, but the gradual emergence of a more diversified network of interoperable infrastructures. The key question for the coming decade will not be which single system prevails. It will be whether different systems can work together safely, efficiently and under standards that market participants trust.
Concluding remarks
Ladies and gentlemen, as Hong Kong continues to develop its fixed income and currency markets, our choice is clear. We will strengthen connectivity, build more robust, efficient and open market infrastructure, and continue to help global capital access Mainland opportunities. The future of finance should be shaped by systems that can work together - and Hong Kong is ready to help realise that connectivity faster.
I wish this Summit every success, and all of you good health, and the best of business. Thank you very much.
The Financial Secretary, Mr Paul Chan, speaks at the Hong Kong FIC & Bond Connect Summit today (July 7). Source: HKSAR Government Press Releases
