The Hong Kong Monetary Authority, together with the People’s Bank of China and the Securities and Futures Commission, has announced a package of measures to deepen Hong Kong-Mainland market connectivity and expand Hong Kong’s fixed income and currency market and offshore renminbi business. The package combines infrastructure and product changes across Bond Connect and Swap Connect with steps to widen offshore RMB liquidity and instruments, including a major increase in the Hong Kong Monetary Authority’s RMB Business Facility. On cross-border market access, the measures support development of a Hong Kong fixed income and currency electronic trading platform by financial market infrastructures in Hong Kong and the Mainland. Southbound Bond Connect will be enhanced through a higher annual investment quota, development of bond repurchase business using Southbound Bond Connect bonds as collateral, a broader product scope covering products with HKD bonds and RMB bonds as underlying assets, a connection to the Macao bond market, and stronger market maker management. The package also supports use of onshore Ministry of Finance and Mainland policy bank bonds held under Northbound Bond Connect as eligible margin collateral at HKFE Clearing Corporation and SEHK Options Clearing House, extends Northbound Bond Connect settlement time, adds the interbank 7-Day Fixing Depository-Institutions Repo Rate as a reference rate under Swap Connect, and backs the launch of Hong Kong Exchanges and Clearing Limited 5-Year China Government Bond Futures in Hong Kong. For the offshore RMB market, the Hong Kong Monetary Authority will increase the RMB Business Facility to RMB500 billion from RMB200 billion and add 9-month, 2-year and 3-year tenors, effective 10 July 2026. It is also exploring a tendering mechanism for 7-day offshore RMB liquidity, possible issuance of offshore RMB short-term debt instruments to help build the offshore RMB yield curve, a bilateral currency transaction framework between the Indonesian rupiah and offshore RMB, and issuance of good practices to banks to promote RMB adoption. Hong Kong Exchanges and Clearing Limited plans to launch the 5-Year China Government Bond Futures contract on 3 August.

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