Official launch of Northbound Trading of Swap Connect
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The following is issued on behalf of the Hong Kong Monetary Authority:
Northbound Trading of Swap Connect is officially launched today (May 15).
Northbound Trading of Swap Connect provides a convenient and secure channel for international investors to trade interest rate swap products in the Mainland via a connection between infrastructure institutions in Hong Kong and the Mainland. The scheme aims to facilitate global investors’ management of interest rate risks arising from their allocation to Mainland bonds.
The Chief Executive of the Hong Kong Monetary Authority (HKMA), Mr Eddie Yue, said, “The launch of Northbound Trading of Swap Connect is another new milestone in the financial co-operation between Hong Kong and the Mainland. It will create favourable conditions for global investors to increase their participation in the onshore bond market, and carries special significance for enhancing the recognition of and confidence in Renminbi (RMB) bonds in the international market. Northbound Trading of Swap Connect will also provide new opportunities for Hong Kong’s financial institutions and strengthen Hong Kong’s role as a global risk management centre and offshore RMB hub.”
The HKMA will closely monitor the implementation of the Northbound Trading of Swap Connect together with relevant Hong Kong and Mainland regulators, and enhance operational arrangements in accordance with market development and investor needs. The HKMA will continue to explore with Mainland authorities the provision of more diversified risk management tools to international investors.