"互换通"运行机制迎优化。 为进一步提升内地与香港利率互换市场互联互通合作（下称"互换通"）市场活力，中国外汇交易中心（下称交易中心）9月25日发布消息称，将在中国人民银 行指导下优化"互换通"运行机制。具体措施包括建立"互换通"报价商动态调整机制，并扩充报价商队伍。完善每日净限额动态评估机制，并自2025年10月13 日起提高每日净限额至450亿元。 自2023年5月15日上线以来，"互换通"为境外投资者开展人民币资产配置提供了便利、高效的利率风险管理工具，交易清算等机制安排运转顺畅，境内外投资 者积极踊跃参与，业务量持续上升。截至2025年8月底，已有来自15个国家和地区的82家境外投资者累计达成人民币利率互换交易1.5万余笔、名义本金8.15 万亿元。 2024年5月，"互换通"机制安排迎来优化，推出以国际货币市场结算日为支付周期的利率互换合约、历史起息的利率互换合约及合约压缩功能等。今年5 月，"互换通"机制得到进一步优化，包括延长合约期限，扩充产品谱系等。 随着国际投资者对人民币利率互换的兴趣不断提升，对"互换通"产品需求不断增加。此前已有部分市场机构建议，扩大"互换通"交易限额，丰富"互换通"产品 ...

Core Insights - The China Foreign Exchange Trading Center is optimizing the "Swap Connect" mechanism to enhance market vitality and better meet the needs of foreign investors in managing RMB interest rate risks [1] - Since its launch on May 15, 2023, "Swap Connect" has facilitated over 15,000 RMB interest rate swap transactions with a nominal principal of 8.15 trillion yuan from 82 foreign investors across 15 countries and regions [1] - Future improvements to the "Swap Connect" mechanism will be made in collaboration with domestic and foreign market participants to support the high-level opening of China's financial market and the internationalization of the RMB [1] Group 1 - The establishment of a dynamic adjustment mechanism for "Swap Connect" quote providers and the expansion of the quote provider team [1] - The enhancement of the daily net limit dynamic assessment mechanism, with an increase in the daily net limit to 45 billion yuan starting from October 13, 2025 [1] - The ongoing collaboration with the People's Bank of China and market participants to continuously optimize the "Swap Connect" arrangements [1]

Core Insights - DR007, the 7-day repurchase rate in the interbank market, serves as a crucial indicator of market liquidity and has become a benchmark for loan rates, bond yields, and derivative pricing since its inception in 2014 [1] Group 1: Development of the Foreign Exchange Trading Center - The China Foreign Exchange Trading Center (CFETS) was established in 1994, marking the beginning of the market-oriented reform of interest rates in China [2] - CFETS has evolved into a vital infrastructure within the Chinese financial system, serving nearly 6000 institutions across over 70 countries and regions [2] - The interbank market has grown significantly, with a projected transaction volume of 261.7 trillion yuan in 2024, averaging over 10.5 trillion yuan daily [3] Group 2: Technological Advancements - The transition from manual trading to electronic trading systems has greatly enhanced market efficiency, with the latest systems capable of processing 100,000 transactions per second [3] Group 3: Bond Market and Foreign Participation - China's bond market, valued at 190 trillion yuan, ranks second globally and has attracted significant foreign investment, with over 1100 foreign institutions holding 4.23 trillion yuan in bonds [4] - The introduction of the "Northbound Trading" scheme in 2017 has streamlined access for foreign traders, allowing them to trade domestic bonds directly from Hong Kong [4][6] Group 4: Innovative Trading Mechanisms - CFETS has expanded its access mechanisms, including "Northbound Trading," "Southbound Trading," and "Swap Connect," to meet the liquidity management and risk hedging needs of foreign institutions [5] - The "Swap Connect" allows foreign investors to access the onshore interest rate swap market through familiar international electronic trading platforms, enhancing transaction efficiency [6]

Group 1 - The China Foreign Exchange Trading Center has launched significant measures to enhance financial market openness, showcasing vibrant growth and innovation in the sector [1][2] - Since its establishment in 1994, the center has evolved from a single foreign exchange trading platform to a comprehensive financial market platform covering various instruments, with the Chinese bond market reaching a scale of 189 trillion yuan, ranking second globally [1] - The center has facilitated access for 1,170 foreign institutional investors from over 70 countries, with total holdings of Chinese bonds amounting to 4.23 trillion yuan [1] Group 2 - A notable innovation is the "Bond Connect" program launched in 2017, which consists of "Northbound" and "Southbound" channels, connecting China's bond market with the global market [1] - The center has introduced the "China-Europe Green Bond Common Classification Directory," which has certified 276 bonds, providing a standardized framework for international investors in Chinese green financial products [2] - The trading hours have been extended to 20 hours daily, allowing investors in major financial hubs like London, New York, and Singapore to participate in the Chinese financial market during local working hours [2] Group 3 - Shanghai has become an international financial center, attracting numerous foreign financial institutions, with 1,796 licensed financial institutions by June 2025, of which 556 are foreign, accounting for nearly one-third [2] - In 2024, the offshore trade settlement volume through free trade accounts reached 106.9 billion yuan, reflecting the city's financial ecosystem and openness [2] - The China Foreign Exchange Trading Center aims to continue its role as a bridge, focusing on building a "global RMB trading main platform" and expanding cross-border business [2]

Core Viewpoint - The article highlights the significant evolution of China's foreign exchange market since the 1994 reform, emphasizing the role of the China Foreign Exchange Trading Center in facilitating the growth and openness of the financial market [1][3]. Group 1: Development of the Foreign Exchange Market - The China Foreign Exchange Trading Center has transformed from a small-scale market serving only domestic banks to a leading platform for global RMB and related asset trading, serving nearly 6000 institutions across over 70 countries and regions [3]. - The interbank market's trading volume has seen an average annual growth rate exceeding 35% since the establishment of the China Foreign Exchange Trading Center [5]. - As of 2024, the interbank foreign exchange market's transaction volume is projected to reach 261.7 trillion yuan, with an average daily trading volume of 10.5 trillion yuan, accounting for approximately 70% of major financial markets in China [5]. Group 2: Internationalization and Accessibility - The China Foreign Exchange Trading Center has implemented various measures to open the interbank market, providing a "multi-currency, multi-mechanism, one-stop" investment channel for global investors [7]. - Over 1100 foreign institutional investors participate in the Chinese interbank market, holding approximately 4 trillion yuan in bonds, with the bond market's trading volume reaching 19.1 trillion yuan in 2024 [7]. - The introduction of the Bond Connect "Northbound" and "Southbound" services has facilitated cross-border investment, with 834 foreign institutions entering the market through the Northbound channel and 1171 institutions participating in the Southbound channel [7]. Group 3: Shanghai as an International Financial Center - Shanghai is positioned as a strategic international financial center, with a focus on creating a market-oriented, law-based, and international business environment [9]. - As of June 2023, Shanghai has 1796 licensed financial institutions, with 556 being foreign entities, representing nearly one-third of the total [9]. - The city aims to enhance financial services to stabilize foreign trade and investment, while promoting higher levels of financial reform and opening up to invigorate market dynamics [9].

Core Insights - The launch of the "Northbound Swap Connect" long-term interest rate swap contracts on June 30 is seen as a significant step in meeting the long-term interest rate risk management needs of foreign investors and enhancing the openness of China's financial market [1][4] Group 1: Market Participation and Initial Performance - On the first day of trading, 25 domestic and foreign institutions participated, with a total of 56 transactions and a nominal principal amount of 1.53 billion yuan [1] - The successful organization of the first day's trading and settlement indicates smooth operation of the business and systems [1] Group 2: Demand for Long-term Derivatives - The demand for long-term government bonds has increased among foreign investors, with holdings of 30-year government bonds exceeding 100 billion yuan [2] - The introduction of the 30-year interest rate swap contract is expected to enhance the depth and breadth of the domestic and foreign interest rate derivatives market [2][3] Group 3: Benefits of the New Product - The new contracts will improve the yield curve and fill the gap in long-term interest rate management tools, providing precise duration matching for long-term funds like insurance and pensions [3] - The introduction of these products is anticipated to reduce irrational selling behavior in the market, thereby enhancing financial market stability and boosting foreign investor confidence [3] Group 4: Financial Market Connectivity - The "Northbound Swap Connect" has become a major channel for foreign investors to manage interest rate risks associated with RMB assets, with cumulative trading and clearing reaching 7.16 trillion yuan by June 2025 [4] - The initiative is supported by regulatory bodies in both regions, which have optimized business operations to facilitate cross-border trading [4][5] Group 5: Future Developments - The expansion of LPR-based interest rate swap contracts will further diversify the product offerings available to foreign investors, catering to various risk management needs [6]

Group 1 - The core viewpoint of the news is the official launch of the "Swap Connect" between the mainland and Hong Kong, aimed at enhancing the financial market's openness and facilitating offshore institutions in managing RMB interest rate risks [1][2] - Since its launch, the "Swap Connect" has seen a continuous increase in transaction volume, with over 12,000 RMB interest rate swap transactions completed by 20 domestic quoting firms and 79 overseas investors, totaling a nominal principal amount of approximately 6.5 trillion RMB by the end of April 2025 [1] - The People's Bank of China and relevant Hong Kong authorities plan to further enrich the "Swap Connect" product offerings, including extending the contract duration to 30 years and introducing interest rate swap contracts based on the Loan Prime Rate (LPR) [2] Group 2 - The optimization measures for "Swap Connect" will include the introduction of interest rate swap contracts with international currency market settlement days and historical start dates, enhancing the convenience for foreign investors [1] - The financial management departments of both regions will continue to guide the financial market infrastructure institutions to improve mechanisms based on the operational experience of "Swap Connect," promoting the internationalization of the RMB and supporting the development of Hong Kong as an international financial center [2]

Group 1 - The "Southbound Bond Connect" is set to expand significantly, allowing non-bank institutions such as insurance companies to participate, which will enhance their overseas investment channels [1][3] - As of May 2025, the "Southbound Bond Connect" has seen substantial growth, with 918 bonds and a total balance of 532.94 billion yuan, a significant increase from 35 bonds and 5.525 billion yuan in September 2021 [2] - The expansion of the "Southbound Bond Connect" is expected to provide a more efficient pathway for insurance funds to invest in overseas bonds, particularly in a high-interest-rate environment in the US and Eurozone [4] Group 2 - The current quota for net capital outflow through the "Southbound Bond Connect" is set at 500 billion yuan annually, with a daily limit of 20 billion yuan, which is crucial for managing the investment needs of insurance companies [3] - Insurance companies have been actively preparing for the opportunities presented by the "Southbound Bond Connect," with many forming specialized teams to enhance their systems for upcoming business opportunities [6] - The participation of insurance funds in the "Southbound Bond Connect" represents a significant step in the financial market's opening and a key opportunity for the insurance industry to deepen asset allocation reforms [6]

Group 1 - The implementation of QFII/RQFII regulations has enhanced the accessibility and convenience for foreign investment in China's stock and bond markets [1][2] - As of the end of 2020, the number of qualified foreign institutional investors (QFII) reached 558, with 45 new institutions approved since the new regulations took effect [2] - Foreign ownership in A-shares has been steadily increasing, with foreign institutions holding approximately 3.50 trillion yuan, accounting for 5.12% of the total A-share market by mid-January 2021 [3] Group 2 - The capital market's further opening is a key task for 2021, focusing on enhancing cross-border audit cooperation and regulatory capacity [4] - The inclusion of Sci-Tech Innovation Board stocks in international indices is anticipated, with MSCI and FTSE Russell set to evaluate these stocks for inclusion in their indices [4] - There is significant potential for foreign capital inflow into A-shares, driven by economic recovery and the appreciation of the yuan, with foreign ownership expected to continue rising [5]

Core Viewpoint - The Bond Connect has reached its eighth anniversary, showcasing significant growth in international participation in China's bond market and announcing new optimization measures to enhance cross-border investment opportunities [1][2][3]. Group 1: Market Growth and Participation - As of May 2025, over 1,169 international investors from more than 70 countries and regions have participated in China's interbank bond market, with foreign institutions holding onshore bonds worth 4.35 trillion yuan, reflecting a compound annual growth rate of approximately 12% over the past five years [1]. - In 2024, the total trading volume of the "Northbound" Bond Connect reached 10.4 trillion yuan, setting a new record, with a year-to-date trading volume of 4.66 trillion yuan as of the end of May, an increase of 205 billion yuan compared to the same period last year [3]. Group 2: New Optimization Measures - The People's Bank of China announced three new measures to enhance the Bond Connect, including improving the "Southbound" mechanism to allow more domestic investors to invest in offshore bond markets, expanding the eligible investor categories to include non-bank financial institutions [3][4]. - The optimization of offshore repurchase business mechanisms will facilitate liquidity management for foreign investors, allowing transactions in multiple currencies such as USD, EUR, and HKD, and simplifying operational processes [5]. - The "Swap Connect" will also be optimized to better meet investors' interest rate risk management needs, with plans to expand the range of products and adjust daily trading limits [5][6]. Group 3: Future Outlook - The Bond Connect is expected to continue serving as a bridge between China's bond market and international investors, promoting the diversification of onshore and offshore RMB product ecosystems [2][8]. - The Hong Kong Monetary Authority emphasizes the importance of these new measures in solidifying Hong Kong's role as an international financial center and offshore RMB hub, enhancing the liquidity of offshore RMB products [8]. - Industry experts anticipate increased inflows of foreign capital, particularly long-term funds, as China's bond market continues to develop and diversify [9].