Hong Kong is expected to see a rise in bond issuance across multiple currencies in 2026, driven by rising demand for non-US dollar assets amid geopolitical tensions and government initiatives to strengthen the city’s capital markets, according to industry players.
As part of efforts to promote the local bond market, the Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) launched a blueprint in September to expand yuan-linked products and widen the investor base for fixed-income offerings.
Some measures have already been rolled out, such as the launch of the cross-border repo business at the end of September. More initiatives were expected in 2026, with the collateral management of repo transactions set to shift from manual to automated processes from February 2, according to the HKMA.
“The road map issued by the HKMA and the SFC is important in setting the direction for the future development of the Hong Kong bond market and currency trading,” said John Lee Chen-kwok, vice-chairman and co-head of Asia coverage at UBS in Hong Kong, one of the leading arrangers of major bond deals in the city.
“The Hong Kong bond market is expected to continue to grow in 2026 after strong development over the past two years, with many big names such as the Airport Authority Hong Kong, Urban Renewal Authority, MTR Corp, Hong Kong Mortgage Corp and the Hong Kong government.”
Issuance had become more diversified, with bonds denominated in Hong Kong dollars, yuan and US dollars, Lee said. “The growth is due to government promotion of the bond market and also the introduction of Bond Connect, which attracts more issuers to Hong Kong to tap mainland investors through the connect scheme.”