China’s central bank expanded the RMB Business Facility quota to 500 billion yuan (about US$74 billion), enabling Hong Kong banks to access more yuan liquidity via loans from the Hong Kong Monetary Authority [1, 2, 3, 4]. The annual quota for the Southbound Bond Connect, which allows mainland investors to purchase offshore bonds through Hong Kong, increased from 500 billion yuan to 800 billion yuan [1, 5, 2, 3, 4]. There is some discrepancy on the US dollar equivalent of this quota, with estimates ranging from about US$74 billion to nearly US$118 billion [s1,s3,s4 versus s2,s5].
On July 7, 2026, PBOC Governor Pan Gongsheng announced these enhancements at the Hong Kong FIC & Bond Connect Summit [1, 2, 3, 4]. He said, “As the global monetary system accelerates its evolution toward a multi-polar one, international demand for yuan is extending beyond trade settlement to broader areas including investment, financing, pricing and reserves. Hong Kong’s role as the global offshore yuan hub will certainly be enhanced” [1]. Pan described the measures as “a positive step towards strengthening financial market connectivity, attracting international capital and enhancing Hong Kong’s unique role as the gateway between China and global markets” [4]. The central bank also plans to continue increasing allocations of China’s foreign reserves to Hong Kong to support the offshore yuan market [1, 2, 3, 4].
On the same day, Hong Kong launched a trial operation of its new central gold clearing system backed by major banks, aiming to establish a comprehensive gold trading ecosystem [1, 2, 3, 4]. Hong Kong Chief Executive John Lee said, “If gold is the world’s safe haven, then Hong Kong will be its safe harbour” [4]. The city aims to grow its gold storage capacity to over 2,000 tonnes by 2030, more than tenfold its current levels [4].
China has maintained a cautious monetary policy since May 2025 amid economic slowdown signs such as declining retail sales and investment [1, 2, 3]. However, Beijing and Hong Kong introduced multiple measures on July 7, 2026, including reviving US dollar gold futures trading and expanded foreign exchange reserve deployments, to bolster financial connectivity [4].
