Overview

• Chief Executive John Lee Ka-chiu said the US dollar peg will remain a core element of Hong Kong’s financial stability.
• The Hong Kong Monetary Authority injected HK$129.4 billion in May to buy US$16.7 billion and keep the exchange rate within its 7.75–7.85 trading band.
• Sharp swings in the Hong Kong dollar over the past two months, driven by equity inflows and regional currency moves, prompted the HKMA’s forceful interventions.
• Some market watchers had urged a shift to a yuan peg, but Lee rejected the idea in favor of preserving the existing dollar arrangement.
• Lee pledged to introduce more yuan-denominated products as part of plans to expand Hong Kong’s role as the world’s offshore renminbi hub.