The Hong Kong Monetary Authority announced on the 7th that the Ministry of Finance will issue RMB treasury bonds through the Central Settlement System of Debt Instruments of the Hong Kong Monetary Authority, with a total scale of 12 billion yuan, divided into four years. The issuance this time is the first tranche of RMB treasury bonds in 2024, including 3 billion yuan of two-year treasury bonds, 3 billion yuan of three-year treasury bonds, 3 billion yuan of five-year treasury bonds, and 3 billion yuan of 10-year treasury bonds. Treasury bonds will be tendered on March 13 and settled on March 15. As of 2023, the Ministry of Finance has issued sovereign bonds in Hong Kong for 15 consecutive years, and has issued a total of 311 billion yuan of treasury bonds. Among them, 50 billion yuan of treasury bonds will be issued in four phases in 2023, an increase of 117% from the previous year, and the scale reached a record high.
According to the Financial Associated Press, this new issuance of treasury bonds signifies the Ministry of Finance’s continued engagement with the Hong Kong market. The issuance of RMB-denominated bonds in Hong Kong has been a strategic move by the Chinese government to expand the internationalization of the yuan and deepen financial cooperation between Hong Kong and mainland China.
Investors and analysts will be closely watching the outcome of the tendering process on March 13 to gauge market demand for these treasury bonds. The scale of this issuance, along with the increasing trend in issuance volumes, reflects the growing confidence in the stability and attractiveness of RMB-denominated assets.
As always, investors are advised to make informed decisions and consider the risks associated with any investment. The Ministry of Finance’s issuance of treasury bonds in Hong Kong presents an opportunity for investors looking to diversify their portfolios and potentially benefit from the evolving financial landscape in the region.