Regarding the mention in the ‘Roadmap for the Development of Fixed Income and Currency Markets,’ where the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) will further promote the development of a market-based offshore Renminbi yield curve, Assistant Chief Executive (External Affairs) of the HKMA, Hui Hoi-chi, stated that there is a need to provide benchmarks for market reference. This is because Hong Kong lacks a recognized and liquid risk-free yield curve, making it difficult for the market to predict future interest rate movements.
He also mentioned that the relevant measures target international investors holding mainland bonds through the northbound leg of the Bond Connect program, allowing them to participate in mainland repurchase agreements with the proceeds transferable for overseas use. This would help meet investors’ liquidity management needs, activate their Renminbi holdings, and enhance the attractiveness of Renminbi bond assets internationally.
