HKEX has launched a new five-year China government bond (CGB) futures contract, as part of an effort to bolster fixed income and currencies (FIC) markets in Hong Kong.
Carlson Tong
The new contract is set to enhance collaboration and connectivity between the Chinese mainland and Hong Kong financial markets and will support the establishment of Hong Kong as an international financial hub.
The launch is also expected to strengthen Hong Kong’s offshore Renminbi (RMB) market.
“A vibrant FIC market is critical to Hong Kong’s future growth as an international financial centre,” said Carlson Tong, HKEX chair.
“The launch of five-year China government bond futures further strengthens Hong Kong’s offshore RMB product suite, supports the continued internationalisation of the currency, and reinforces the city’s position as a comprehensive platform for capital formation, trading and risk management.”
Read more – HKEX boosts Bursa Malaysia to Recognised Stock Exchange status
The move also expands HKEX’s China-related product suite, and the newly launched contract serves as the only CGB futures contract available in the offshore market, enabling investors to manage duration and interest rate exposure to the Chinese mainland bond market.
Enhanced collaboration between Hong Kong and Chinese mainland futures markets is expected to support future launches of RMB-denominated futures products in Hong Kong, as well as encourage the launch of more ETF products on both markets.
The five-year CGB futures contract us supported by 13 liquidity providers, spanning banks and securities firms including Bank of China, Standard Chartered and CGS International Holdings.
Bonnie Y Chan, HKEX chief executive, said: “From Bond Connect and Swap Connect to our growing derivatives, commodities and FIC offerings, we are creating a more integrated ecosystem that enables investors to allocate capital, manage risk and access new opportunities.
“Looking ahead, we will be working closely with regulators, infrastructure partners and market participants to expand connectivity, broaden product choice and strengthen risk-management capabilities across asset classes.”