Hong Kong and mainland Chinese regulators announced a package of measures on 7 July to expand cross-border bond trading and strengthen the city’s offshore renminbi market.

The Hong Kong Monetary Authority, the People’s Bank of China and the Securities and Futures Commission said they would increase the annual investment quota for Southbound Bond Connect and develop a new electronic trading platform for fixed income and currency products.

The measures include allowing bonds held through Southbound Bond Connect to be used as collateral for repurchase agreements, and extending the scheme to cover products linked to Hong Kong dollar and renminbi bonds. The programme will also be connected to the Macao bond market.

For Northbound Bond Connect, onshore bonds issued by the Ministry of Finance and mainland policy banks will become eligible as margin collateral at Hong Kong’s derivatives clearing houses. Settlement times will also be extended.

Hong Kong Exchanges and Clearing will launch five-year China government bond futures on 3 August, the regulators confirmed.

Separately, the HKMA announced five measures to develop offshore renminbi business. The authority will increase its RMB Business Facility from RMB200bn to RMB500bn and extend available tenors to include nine-month, two-year and three-year maturities, effective 10 July 2026.

The HKMA said it is also exploring a seven-day offshore renminbi liquidity tendering mechanism and the issuance of short-term debt instruments to help establish an offshore renminbi yield curve. The authority will promote a bilateral currency framework between the Indonesian rupiah and offshore renminbi.