Bond Price Bulletin One of the factors affecting secondary market activities in the bond market is the lack of information on bond prices. To help overcome this problem, the HKMA launched the Bond Price Bulletin at the beginning of 2006. The bulletin provides investors with convenient on-line access to information on bond products and bond prices provided by eight major banks in Hong Kong. Indicative bid/offer prices of over 200 bonds of different currencies issued by both public and private sector entities are provided by the eight contributing banks. Outlook Let me now turn to talk about the outlook of our debt market. Notwithstanding the achievements we have made so far in developing our debt market, we fully appreciate that there is nothing to be complacent and there are still many challenges facing us. The HKMA has therefore embarked on a review of our debt market development with a view to identifying measures which can be adopted to help market development. On the demand side, everybody knows that the Mainland of China is enjoying a rapid economic growth and business opportunities are mushrooming. The recent announcement by the Mainland authorities of measures to liberalise portfolio investment outflows has marked the emergence of such kind of opportunity for Hong Kong. Under these new rules, each Chinese citizen is allowed, among other things, to invest in fixed income securities overseas within certain limits.
With the seamless interfaces between the CMU and the Real Time Gross Settlement (RTGS) systems in Hong Kong for the Hong Kong dollar, US dollar and Euro, all transactions in debt instruments denominated in any of these three currencies and under the custodianship of the CMU can be settled in Hong Kong on a DvP basis in an efficient way. The recent IPO of the Bank of China Limited is probably a good example to demonstrate the efficiency and robustness of our HKD RTGS system: being a settlement system which typically handles an average turnover of $ to $ billion Hong Kong dollars a day, it saw a record high turnover of $ trillion on 1 June when the Bank of China was listed on that day. Notwithstanding such huge amount of settlement, the inter-bank payments were processed smoothly on that day. To further develop Hong Kong into a payment and settlement hub for the region, we will continue to explore opportunities for linking our RTGS systems and the CMU with similar systems in the region. For example, the HKMA has been working with Bank Negara Malaysia for the establishment of a link between the Ringgit RTGS system and the US dollar RTGS system in Hong Kong. This is aimed at reducing the settlement risk of Ringgit/US dollar foreign exchange transactions through PvP settlement in the Asian time zone. The link is expected to go live by the end of 2006. We are exploring similar linkages with other Asian central banks.