China issues US$8.2 billion in bills in Hong Kong to stabilise yuan amid trade tensions.

The People’s Bank of China (PBOC) completed the tender of 60 billion yuan (US$8.2 billion) worth of central bank bills in Hong Kong on Friday, marking the second time this year it has used the policy tool to stabilise the yuan amid tariff tensions with the US.

The sale comprised 40 billion yuan in three-month bills, which were nearly 3.4 times subscribed with a bid-winning coupon rate of 2.60 per cent, and 20 billion yuan in one-year notes, which were almost 3.3 times subscribed with a coupon rate of 2.32 per cent. The PBOC tendered the bills through the Central Moneymarkets Unit (CMU) of the Hong Kong Monetary Authority (HKMA).

The issuances aimed to “enrich Hong Kong’s high-credit-rating yuan financial products and improve Hong Kong’s yuan yield curve”, the PBOC said as it unveiled the move on Wednesday.