Hong Kong government worries about global water release risk and promotes HK $13 billion inflation linked bonds

category:Finance
 Hong Kong government worries about global water release risk and promotes HK $13 billion inflation linked bonds


Chen maobo disclosed that this years minimum interest rate of ibond is guaranteed to be 2%, 1% higher than that of previous ibond. He pointed out that in the current ultra-low interest rate environment, the relevant interest rate increase undoubtedly has great attraction. If inflation rises in the future, ibonds return will be linked to the rise of CPI, so that the return earned can at least keep pace with inflation.

Retail bonds promote the development of Hong Kong Bond Market

Hong Kong citizens can apply for ibond in the retail market, with each ibond of HK $10000. Ibond is a three-year term with interest paid half a year, and the principal and interest are paid in full on the due date. Because the structure is simple and easy to understand, Chen maobo said that this has opened a channel for many small investors to invest in bonds.

From 2011 to 2016, the government launched six batches of ibond. The fixed interest rate of the first six ibonds is only 1 percentage point, which is the minimum dividend level and fluctuates with the inflation rate of Hong Kong in the six months before the dividend. According to the actual dividend payout, ibond performed well, reaching more than 4% at one time, but after 2015, it dropped to less than 2%, and the lowest was only 1.02%. Chen said the ibond design has the advantage of taking both sides into consideration. If the Composite CPI is negative, ibond design has a minimum return guarantee to ensure that investors will not fall into zero return. In the impression of investors, bonds are usually sold by large wholesale institutions. However, there are many retail bonds targeted at small investors in Hong Kong. Chen maobo said that ibond, silver bonds, retail bonds issued by the Ministry of Finance and other enterprises in Hong Kong make capital financing and allocation more efficient. They also allow citizens to have more investment options and promote the further development of the Hong Kong Bond Market on the premise of considering their own risk tolerance. Source: responsible editor of 21st century economic report: Wang Wenhua_ NF5982

From 2011 to 2016, the government launched six batches of ibond. The fixed interest rate of the first six ibonds is only 1 percentage point, which is the minimum dividend level and fluctuates with the inflation rate of Hong Kong in the six months before the dividend. According to the actual dividend payout, ibond performed well, reaching more than 4% at one time, but after 2015, it dropped to less than 2%, and the lowest was only 1.02%.

In the impression of investors, bonds are usually sold by large wholesale institutions. However, there are many retail bonds targeted at small investors in Hong Kong. Chen maobo said that ibond, silver bonds, retail bonds issued by the Ministry of Finance and other enterprises in Hong Kong make capital financing and allocation more efficient. They also allow citizens to have more investment options and promote the further development of the Hong Kong Bond Market on the premise of considering their own risk tolerance.