Key Information

inSight
Speeches
Speeches by Speaker
Norman T.L. Chan
Peter Pang
Eddie Yue
Arthur Yuen
Zeti Akhtar Aziz
Raymond Li
Edmond Lau
Esmond Lee
Meena Datwani
Vincent W.S. Lee
James Lau
Joseph Yam
Y K Choi
William Ryback
David Carse
Tony Latter
Andrew Sheng
Hans Genberg
Simon Topping
Michael Taylor
The Honourable Donald Tsang
Chen Yuan
Dai Xianglong
Don Brash
Jaime Caruana
Andrew Crockett
Mario Draghi
David Eldon
Stanley Fischer
Timothy F. Geithner
Stephen Grenville
Kenneth G. Lay
William McDonough
Ernest Patrikis
Glenn Stevens
Jean-Claude Trichet
Tarisa Watanagase
Zeti Akhtar Aziz
Carmen Chu
Alan Au
Press Releases
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
Press Releases by Category
Bogus Voice Message Phone Calls
Banking in Hong Kong
Fraudulent Websites, E-mails and Telephone System, and other fraud cases
Granting of Banking Licences
Exchange Fund
Table of Multiples of Notes and Payments for Allotted Amount under non-competitive tender
Table of Multiples of Notes and Payments of Application Amount under non-competitive tender
Tender of Exchange Fund Bills and Notes
Tender Results of Exchange Fund Bills and Notes
Tentative Issuance Schedule for Exchange Fund Bills and Notes
Appointments and Departures
HKMA Pay Review
HKMA Publications
Speeches
The Hong Kong Mortgage Corporation
Hong Kong Note Printing Limited
Hong Kong Institute for Monetary Research
Exchange Fund Investment Limited
Others
Hong Kong Financial Infrastructure
International Relations
Investment Products Related to Lehman Brothers
Monetary Policy
Notes and Coins
Renminbi business
Credit Card Lending Survey
Monetary Statistics
Residential Mortgage Survey
Year 2000
Others
Guidelines and Circulars
Guidelines
Circulars
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
515.5995

Press Releases

Record of Discussion of the Meeting of the Exchange Fund Advisory Committee Currency Board Sub-Committee held on 14 September 2005

(Approved for Issue by the Exchange Fund Advisory Committee on 29 September 2005)

Report on Currency Board Operations (30 July - 30 August 2005)

The Sub-Committee noted that the Hong Kong dollar exchange rate had strengthened slightly to close at 7.7707 at the end of the reporting period. Hong Kong dollar interbank interest rates had increased and continued to be close to but slightly below their US dollar counterparts. The Monetary Base had decreased from HK$279.60 billion to HK$277.91 billion, largely reflecting a decline in Certificates of Indebtedness. The Aggregate Balance had remained relatively stable at around HK$1.3 billion.

2. The Sub-Committee noted that, in accordance with Currency Board principles, changes in the Monetary Base had been fully matched by corresponding changes in foreign reserves during the reporting period.

3. The report on Currency Board operations for the period under review is at Annex A.

Monitoring of Risks and Vulnerabilities

4. Members noted that the global economy had been resilient to higher oil prices with robust growth in the US and Mainland China. There were signs of increased economic activity in Europe and Japan following a slowed expansion in the second quarter. Global inflation had increased, mainly due to higher oil prices, but core inflation remained low. Members noted that the Hong Kong economy had gathered further momentum in the second quarter but that the pace of expansion was likely to moderate. Headline inflation had increased in recent months. The rise in interest rates had had some dampening effect on the property market.

5. Members noted a special analysis in the report which suggested that, if oil prices stayed at current levels for a sustained period or increased further, the impact on global growth and Hong Kong could be more significant than that seen so far.

Transferability between Certificates of Indebtedness and the Aggregate Balance

6. The Sub-Committee considered a paper outlining the arguments for and against introducing transferability between CIs and the Aggregate Balance. This subject had previously been raised in May and the HKMA had, on the advice of the Sub-Committee, undertaken to carry out further research into the implications of such a change. While noting that such an arrangement would bring some advantages in terms of tidying up the Currency Board system, Members advised that the system should remain unchanged for the time being but that the issue might be revisited at a future date.

The New Renminbi Exchange Rate Regime and Its Implications for Hong Kong

7. Members noted a report on the new renminbi exchange rate regime announced by the People's Bank of China on 21 July 2005 and its implications for Hong Kong. Developments so far indicated a relatively smooth transition to the new regime. The change to the new regime had not induced speculative inflows into the Hong Kong dollar, helped by the three refinements to the Linked Exchange Rate system which had better anchored exchange rate expectations on the strong side. Members noted that the revaluation of the renminbi was likely to have a limited impact on Hong Kong's output growth and inflation.

For further enquiries, please contact:

Jasmin Fung, Manager (Press), at 2878 8246 or
Hing-Fung Wong, Resource Co-ordinator, at 2878 1802

Hong Kong Monetary Authority
29 September 2005

Last revision date: 1 August 2011
ABOUT THE HKMA
The HKMA
Tender Invitations
Careers@HKMA
Legislative Council Issues
Links
The HKMA Information Centre
KEY FUNCTIONS
Monetary Stability
Banking Stability
International Financial Centre
Exchange Fund
PUBLICATIONS & RESEARCH
Annual Report
Half-Yearly Monetary & Financial Stability Report
Quarterly Bulletin
HKMA Background Briefs
Reference Materials
Research
MARKET DATA & STATISTICS
CMU Bond Price Bulletin
Economic & Financial Data for Hong Kong
Monthly Statistical Bulletin
Monetary Statistics
KEY INFORMATION
Press Releases
Speeches
Guidelines & Circulars
Forthcoming Events
inSight
OTHER INFORMATION
Information in Other Languages (Bahasa Indonesia, हिन्दी, नेपाली, ਪੰਜਾਬੀ, Tagalog, ไทย, اردو)
Account Opening
Consumer Corner
Consumer Education Programme
Complaints about Banks
Complaints about SVF Licensees
Internet Banking
Fraudulent Bank Websites, Phishing E-mails and Similar Scams
Be Careful of Bogus Phone Calls and SMS Messages
Authenticate the Callers and Bank Hotline Numbers
Register of AIs & LROs
Register of Securities Staff of AIs
Register of SVF Licensees
Investment Products Related to Lehman Brothers
Photo Gallery