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HONG KONG, May 16 (Reuters) - Hong Kong and Chinese regulators said on Tuesday they had formally approved a long-awaited scheme to connect China's $8 trillion bond market with overseas investors, in another milestone in the opening up of China's capital markets.
Plans for a "Bond Connect" programme have been in the works since Beijing launched a scheme allowing two-way trading between the Hong Kong and Shanghai stock markets in 2014, but the authorities have provided few details on the mechanics or the timeline.
The Hong Kong Monetary Authority, Hong Kong's bond market regulator, and the People's Bank of China said trading will initially commence "Northbound" only, meaning only foreign and Hong Kong investors will be able to trade Chinese bonds initially.
The regulators said the launch date of the scheme will be unveiled later. (Reporting by Michelle Price, Samuel Shen and Elias Glenn; Editing by Muralikumar Anantharaman)