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]