Beijing and Hong Kong introduced steps on July 7 to strengthen the city's role in offshore Yuan activity and gold settlement. The measures include expanded liquidity facilities and higher investment quotas. Officials aim to make non-dollar routes more accessible for institutions.
Hong Kong started trial operations of a central gold clearing and settlement system. It revived US dollar-denominated gold futures and began exploring Yuan-denominated gold futures. The city also plans to expand its total gold storage capacity to more than 2,000 metric tons within three years.
The Hong Kong Monetary Authority raised its RMB Business Facility for local banks from 200 billion Yuan to 500 billion Yuan. The change took effect on July 10. Separately, authorities increased the annual Southbound Bond Connect investment quota to 800 billion Yuan.
These actions position Hong Kong as a hub for Yuan funding, gold settlement, and access to Chinese capital markets. The package targets institutions outside mainland China seeking alternatives to dollar-based systems.