Exchange Fund's US dollar assets reduced to 79pc

Hong Kong’s de facto central bank said the proportion of US dollar assets in the Exchange Fund has decreased to around 79 percent, down from over 90 percent.

Hong Kong Monetary Authority chief executive Eddie Yue Wai-man said the reduction is part of a broader strategy to diversify investments into other currencies, including the yuan, euro, yen and pound, as well as private equity.

Yue explained that while part of the fund must remain in liquid US dollar assets to support the monetary base, the authority has been shortening the duration of US Treasury holdings as a defensive measure, given their relatively low volatility.

Yue also noted that Hong Kong financial markets currently remain stable and future performance will depend on factors such as tariffs, mainland policies, and the performance of the initial public offering market.

STAFF REPORTER