Monetary Statistics for December 2020

According to statistics published today (Friday) by the Hong Kong Monetary Authority, total deposits with authorized institutions decreased by 0.9% in December 2020. Among the total, Hong Kong dollar deposits and overall foreign currency deposits declined by 0.4% and 1.4% respectively. Renminbi deposits in Hong Kong increased by 0.5% to RMB721.6 billion at the end of December. The total remittance of renminbi for cross-border trade settlement amounted to RMB535.8 billion in December, compared with RMB526.3 billion in November.

It should be noted that changes in deposits are affected by a wide range of factors, such as interest rate movements and fund-raising activities. Fluctuations in monthly deposit changes are therefore normal. There was a rebound in total deposits according to the latest data up to the first three weeks of January 2021.

Total loans and advances decreased by 0.4% in December. Among the total, while loans for use in Hong Kong (including trade finance) stayed virtually unchanged, loans for use outside Hong Kong decreased by 1.5%. The Hong Kong dollar loan-to-deposit ratio increased to 83.5% at the end of December from 82.7% at the end of November, as Hong Kong dollar deposits decreased while Hong Kong dollar loans increased.

In the fourth quarter of 2020, loans for use in Hong Kong (including trade finance) decreased by 5.3% following growth of 4.7% in the previous quarter. Analysed by economic use, the decrease in loans during the fourth quarter was mainly led by loans to stockbrokers.

Hong Kong dollar M2 and M3 both dropped by 0.3% in December, but grew by 6.5% compared to a year ago. The seasonally-adjusted Hong Kong dollar M1 decreased by 1.0% in December, but rose by 28.7% compared to a year ago, reflecting in part investment-related activities. Total M2 and M3 both declined by 0.8% in December, but expanded by 5.8% from a year earlier.

As monthly monetary statistics are subject to volatilities due to a wide range of transient factors, such as seasonal and IPO-related funding demand as well as business and investment-related activities, caution is required when interpreting the statistics.

Annex

Hong Kong Monetary Authority
29 January 2021