China’s PBC to issue first batch of RMB-denominated bills for 2025 in H.Kong

The People’s Bank of China (PBC) announced on Thursday its plans to issue the first batch of central bank bills for 2025. The move aimed at enhancing the range of RMB-denominated financial products and improving the yield curve of RMB bonds in Hong Kong, the

The issuance will take place on January 15, 2025, through the Central Moneymarkets Unit (CMU) bond tendering platform of the Hong Kong Monetary Authority (HKMA), as part of an ongoing cooperation between the two institutions.

The PBC will issue 6-month fixed-rate coupon bonds, totaling RMB 60 billion. These bonds will carry a fixed interest rate and will mature on July 18, 2025, unless postponed due to public holidays. The interest on the bonds will begin to accrue from January 17, 2025, with the principal and interest paid at maturity.

Each bill will have a face value of RMB 100, and the issuance will be conducted via a Dutch auction, where investors will submit bids based on the interest rate they are willing to accept.

This issuance is part of the PBC’s broader strategy to deepen the RMB bond market in Hong Kong, creating more opportunities for investors and strengthening Hong Kong’s position as an international RMB hub. The cooperation between the PBC and the HKMA, formalised through the Memorandum of Cooperation on Using CMU for the Issuance of PBOC Bills, is set to foster further development of the RMB bond market and improve liquidity in Hong Kong’s financial markets.

The move is seen as a positive step towards broadening the spectrum of high-credit-rated financial products and enhancing the yield curve for RMB bonds in the region. Investors will be closely monitoring the issuance, which is expected to draw substantial interest from both domestic and international participants.

Attribution: Amwal Al Ghad English