Core Insights - The "Swap Connect" mechanism has provided foreign investors with convenient interest rate risk management tools, enhancing the allocation value of RMB assets and promoting the internationalization of China's bond market [1][6] - The number of foreign investors participating in "Swap Connect" has been steadily increasing, with a more diverse geographical distribution [1][6] - The mechanism has undergone continuous optimization, which is expected to further enhance trading activity [1][3] Group 1: Development and Impact - Over the past two years, "Swap Connect" has met the demand of foreign institutional investors for RMB interest rate risk management, leading to an increase in both the number of participants and trading volume [2][6] - Prior to "Swap Connect," foreign investors could only use offshore financial instruments to hedge domestic interest rate risks, which were not fully compatible with domestic risks and had lower liquidity [2][3] - The average daily settlement amount for "Swap Connect" reached 24.8 billion RMB in the first quarter of this year [2] Group 2: Regulatory and Structural Enhancements - The People's Bank of China has released several regulatory updates to optimize the "Swap Connect" framework, including the introduction of new products and improved functionalities [3][4] - The optimization measures aim to align "Swap Connect" more closely with international trading standards and better meet diverse risk management needs [3][4] Group 3: Future Prospects and Market Expansion - There are expectations for further expansion of "Swap Connect," including the potential for a southbound channel to enhance the two-way opening of the bond market [4][5] - The international appeal of China's bond market has been increasing, with over 1,160 foreign institutions participating and holding a total of 4.5 trillion RMB in bonds [6][7] - The bond market's total scale has reached 183 trillion RMB, making it the second largest in the world, with significant foreign investment potential still remaining [7][8]
架起互联互通高速路
Jin Rong Shi Bao·2025-05-15 03:10