Foreign currency reserves at US$177.1 billion
Hong Kong’s foreign currency reserve assets stood at US$177.1 billion at end-February, according to the Hong Kong Monetary Authority, compared to US$181.7 billion at end-January.
Including unsettled forward contracts, the foreign currency reserve assets also stood at US$177.1 billion, compared to US$181.7 billion the previous month.
Based on these latest figures, Hong Kong is the world’s eighth-largest holder of foreign currency reserves, after mainland China, Japan, Russia, Taiwan, India, South Korea and Brazil.
The foreign currency reserve assets represent more than seven times the currency in circulation, or approximately 42% of Hong Kong dollar M3.
Exchange Fund totals US$198.75 billion
Total assets of the Hong Kong Exchange Fund amounted to US$198.75 billion on January 31, according to the Hong Kong Monetary Authority. This is US$948.71 million less than at end-December.
Foreign currency assets decreased US$1.66 billion, while Hong Kong dollar assets increased US$717.94 million.
The decline in foreign currency assets is due mainly to valuation losses on foreign currency investments, which were partially offset by purchases of foreign currencies with Hong Kong dollars and an increase in Certificates of Indebtedness.
The rise in Hong Kong dollar assets is due mainly to placements received from fiscal reserves, which were partially offset by a decrease in bank borrowings and valuation losses on Hong Kong equities held by the Exchange Fund.
The Currency Board Account shows the monetary base at end-January was US$69.42 billion, an increase of US$4.47 billion, or 6.9%, from the previous month. The rise is due mainly to an increase in Certificates of Indebtedness, reflecting the seasonal demand for banknotes around the Lunar New Year, and the increase in the aggregate balance from the sale of Hong Kong dollars for U.S. dollars. The increase in the latter was offset by the issuance of additional Exchange Fund bills.
Backing assets grew US$3.96 billion, or 5.6%, to US$75.05 billion. The increase is attributable mainly to an increase in the aggregate balance and the issuance of Certificates of Indebtedness in the monetary base, together with interest from investments. These increases were partially offset by revaluation losses. Reflecting this, the backing ratio declined from 109.48% at end-December to 108.11% at end-January.
Anna Wu appointed MPFA chairwoman
Anna Wu recently was appointed chairwoman of the Mandatory Provident Fund Schemes Authority (MPFA) for a term of two years, which began March 17.
Announcing the appointment, Hong Kong Financial Secretary John C. Tsang said Ms. Wu has a strong commitment to public service and is widely recognized for her invaluable contributions to various sectors of Hong Kong’s development.
“Ms. Wu served the MPFA as a nonexecutive director between 1998 and 2005. She possesses a deep understanding of the Mandatory Provident Fund (MPF) system,” he said. “With her dedication and rich experience, we are confident that Ms. Wu will provide capable leadership to the MPFA in furthering the development of the MPF system for the retirement protection of the working population in Hong Kong.”
Mr. Tsang also thanked outgoing Chairman Henry Fan for his insightful advice and guidance in the development of the MPF system.
Seven incumbent nonexecutive directors were reappointed for two-year terms effective March 17. They are Leo Kung, Angelina Lee Wong Pui-ling, Li Fung-ying, David Sun Tak-kei, Wong Ting-kwong, Secretary for Labour and Welfare Matthew Cheung Kin-chung and Secretary for Financial Services and the Treasury K.C. Chan.
Andrew Leung and Wong Kwok-kin were appointed as new nonexecutive directors to two-year terms that began March 17. Kenneth Ting and Tam Yiu-chung stepped down after serving the MPFA for nearly six years.
At end-December, the MPF system covered more than 2.44 million members. Net asset values of all MPF-approved constituent funds amounted to more than US$26.84 billion.
The MPFA is a statutory body established in September 1998 for the regulation and supervision of the MPF system. The system is a vital part of the three-pillar approach to retirement support. It is also the Registrar of Occupational Retirement Schemes.
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