Silver Bond series due 2028 sets second coupon at 3.85 percent
Holders of the Silver Bond Series due 2028 will receive an annualized interest rate of 3.85 percent for their second semi-annual payment. The Hong Kong Monetary Authority confirmed the payout for October 12, 2026, under the Infrastructure Bond Programme.
Floor rate prevails over inflation
The second interest payment for the Silver Bond Series due 2028 (Issue Number 03GB2810R) is fixed at 3.85 percent per annum, the Hong Kong Monetary Authority announced on September 25, 2026.
Under the issue circular dated September 15, 2025, the coupon is determined as the higher of the floating and fixed rates.
The floating rate of 1.80 percent represents the arithmetic average of six months of inflation data from March to August 2026.
The Composite Consumer Price Index rose 1.70 percent year-on-year in March, April, July, and August, alongside 2.00 percent increases in May and June.
With inflation trailing the guaranteed rate, the 3.85 percent floor took effect for the disbursement on October 12, 2026.
Guaranteed yields in a low inflation cycle
Issued under the HKSAR Government Infrastructure Bond Programme, the retail tranche targets senior residents seeking capital preservation and steady returns.
The pricing mechanism guarantees a minimum nominal yield even during periods of mild price increases, safeguarding purchasing power against subdued consumer price inflation.
The calculation applies the 2019/20-based Composite Consumer Price Index series to establish the floating benchmark for each payment cycle across the three-year maturity.
A predictable cushion for savers
The 3.85 percent coupon proves the utility of guaranteed bond floors while consumer inflation lingers below 2 percent.
For senior retail holders, the wide spread over prevailing CPI provides solid real income.
Beyond technical execution, the rate setting simply fulfills statutory issuance commitments.