Mumbai – The Singapore Exchange (SGX) held multiple calls with treasury officials from global banks about introducing futures tied to some Asian government bond markets, according to people familiar with the matter.
The bourse discussed introducing the futures for countries including India, Indonesia, Malaysia, the Philippines and Thailand, the people said. Such futures allow investors to hedge their exposure to interest-rate swings by buying or selling bonds at a later date on exchanges.
The discussions reflect the growing interest in the region’s debt markets. Indian bonds have been joining global indexes over the past 1½ years, while Malaysian securities were investor favourites in 2025, delivering the strongest performance in emerging Asia.
“For bond futures to be successful, the underlying bonds must be liquid, and traders must be able to trade both futures and onshore bonds to maintain the relationship between the futures and the bonds,” said Mr Rajeev De Mello, global macro portfolio manager at Gama Asset Management. “Traders will need the ability to short cash bonds, which is not always easy in some markets.”
For the proposed products, SGX discussed offering three-, five- and 10-year maturities per country, the people said. The futures would be settled in US dollars, with pricing based on average yield of a basket of no more than three sovereign bonds, they said.
For India, the bonds most likely to be considered would fall under the so-called Fully Accessible Route framework, making them eligible for inclusion in global indexes, the people said. Overseas investors have poured US$21 billion (S$27 billion) into the nation’s sovereign bonds since they were added to JPMorgan Chase’s flagship index in June 2024, according to clearing house data.
SGX aims to introduce the futures in the first half of 2026, potentially as early as the first quarter, the people said, adding that the discussions are preliminary and details may change.
The exchange currently offers Japanese government bond futures, Singapore overnight rate average futures and Tokyo overnight average rate futures, according to its website.
The bourse has stepped up its offerings in recent months, as it looks to expand into new segments popular with investors, such as crypto futures. BLOOMBERG
