HK keen to convert some FX reserves to yuan – paper

19-Oct-2010 Intellasia | Reuters | 7:01 AM Print This Post

The Hong Kong Monetary Authority is interested in converting part of the territory’s foreign reserves into yuan and to enter China’s bond market, the China Daily quoted the HKMA’s chief executive as saying on Saturday.

Norman Chan, who was speaking at a summit in Beijing, did not elaborate or provide details, the paper said in its online edition.

The Hong Kong dollar is pegged to the US dollar which has been weakening, triggering inflation fears.

China, however, has a closed capital account and its currency is not yet freely convertible. On Friday, the yuan ended at its highest level against the dollar since its landmark revaluation in July 2005.

Hong Kong’s official foreign currency reserves stood at a record $266.1 billion at end-September, data shows.

Hong Kong ranks as the world’s seventh-largest holder of foreign currency reserves after mainland China, Japan, Russia, Taiwan, India and South Korea.


Category: Hong Kong

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