HKMA Reopens 7-Year RMB Bond, Yield at 1.656%

The Hong Kong Monetary Authority (HKMA) has successfully concluded the reopening of its 7-year RMB-denominated institutional government bonds. The tender, held on August 13, 2026, offered RMB1.25 billion in bonds under the Infrastructure Bond Programme, receiving significant demand with RMB6.01 billion in applications. This resulted in a strong bid-to-cover ratio of 4.81, signaling sustained investor interest.

The average accepted price for the bonds was 100.84, implying an annualised yield of 1.656%. The lowest accepted price was 100.72, corresponding to a yield of 1.675%. The pro-rata allocation ratio stood at approximately 47%, indicating robust competition among bidders. Settlement for the bonds is set for August 17, 2026, with maturity on June 29, 2033. The bonds carry a coupon rate of 1.78%, paid semi-annually.

This reopening follows a similar tender held on June 25, 2026, where the same bond series saw an even higher bid-to-cover ratio of 8.47, with a slightly higher average accepted yield of 1.742%. The decline in yield in the latest auction reflects stronger demand or improved market conditions for RMB-denominated debt instruments.

The HKMA’s Infrastructure Bond Programme aims to support public works and infrastructure development in Hong Kong. These bonds, specifically available to primary dealers, are part of the city’s ongoing efforts to deepen the RMB bond market and strengthen its role as a financial hub for offshore RMB assets.

For institutional investors, the relatively stable yields on these bonds offer an attractive option against ongoing global bond market volatility. Compared to the June issuance, the tighter bid-to-cover ratio and lower yield suggest a maturing appetite for HKSAR government debt among market participants. The 7-year tenor aligns well with medium-term portfolio strategies, especially for institutions seeking semi-annual coupon payments in RMB.

Hong Kong’s consistent issuance of RMB bonds underscores its commitment to expanding the infrastructure funding pool while bolstering the internationalisation of the RMB. With the reopening yielding competitive terms, further issuances are likely to attract strong demand.

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