Author Archives: hksar gov

     Lassana Limited was prosecuted by the Labour Department (LD) for failing to make timely payment of wages to employees as required by the Employment Ordinance (EO). The company pleaded guilty at the Kowloon City Magistrates’ Courts today (August 14) and was fined $54,000.
      
     The company had failed to pay three employees in accordance with the EO wages totalling about $137,000 within seven days after the expiry of the wage periods.

     “The ruling will disseminate a strong message to all employers that they have to pay employees’ wages within the time limit stipulated in the EO,” a spokesman for the LD said.

     “The LD will not tolerate these offences and will spare no effort in enforcing the law and safeguarding employees’ statutory rights,” the spokesman added. read more

     Wing Fat Building Construction Limited and a contractor were fined $50,000 and $59,000 respectively at the Eastern Magistrates’ Courts today (August 14) for violation of the Construction Sites (Safety) Regulations and the Factories and Industrial Undertakings (Gas Welding and Flame Cutting) Regulation. The prosecutions were launched by the Labour Department.
      
     The case involved a fatal accident that occurred on December 6, 2021, at a demolition site in North Point, Hong Kong. A worker, while dismantling a metal structure on the site, was struck and killed by concrete debris that fell from an adjoining demolition site. read more

The following is issued on behalf of the Hong Kong Monetary Authority:

     The Hong Kong Monetary Authority (HKMA) released today (August 14) the key analytical accounts of the Exchange Fund at the end of July 2023.

     Foreign assets, representing the external assets of the Exchange Fund, increased during the month by HK$18.2 billion to HK$3,489.8 billion.

     The Monetary Base, comprising Certificates of Indebtedness, Government-issued currency notes and coins in circulation, the balance of the banking system and Exchange Fund Bills and Notes issued, amounted to HK$1,869.7 billion.

     Claims on the private sector in Hong Kong amounted to HK$287.0 billion.

     Foreign liabilities amounted to HK$22.4 billion.

     The analytical accounts of the Exchange Fund are released in accordance with the International Monetary Fund’s Special Data Dissemination Standard (SDDS) and are referred to as the Analytical Accounts of the Central Bank under SDDS (Annex).

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     At present, four press releases relating to the Exchange Fund’s data are issued by the HKMA each month. Three of these releases are issued to disseminate monetary data in accordance with the International Monetary Fund’s SDDS. The fourth press release, on the Exchange Fund’s Abridged Balance Sheet and Currency Board Account, is made in accordance with the HKMA’s policy of maintaining a high level of transparency. For the month of August 2023, the scheduled dates for issuing the press releases are as follows:
 

The following is issued on behalf of the Hong Kong Monetary Authority:
 
(Approved for Issue by the Exchange Fund Advisory Committee on August 1, 2023)
 
Report on Currency Board Operations (April 18 – June 23, 2023)
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     The Currency Board Sub-Committee (Sub-Committee) noted that the Hong Kong dollar (HKD) traded within a range of 7.8148 – 7.8500 against the US dollar (USD) during the review period. The HKD stayed close to the weak-side Convertibility Undertaking (CU) between mid-April and early May, and the weak-side CU was triggered twice during the period. The HKD had strengthened since early May, mainly driven by dividend payment-related demand from listed companies and half-year-end funding needs by corporates. With the Hong Kong Monetary Authority buying HK$11.59 billion under the weak-side CU, the Aggregate Balance fell correspondingly to around HK$45 billion. Amid the reduction in the Aggregate Balance, HKD interbank rates picked up and the negative spreads against their USD counterparts generally narrowed in the review period. Following the increase in the target range for the US federal funds rate in May, many banks raised their Best Lending Rates by 12.5 basis points, and the Best Lending Rates in the market ranged from 5.750 per cent – 6.250 per cent at the end of the review period. Overall, the HKD exchange and interbank markets continued to trade in a smooth and orderly manner. 

     The Sub-Committee noted that the Monetary Base decreased to HK$1,869.35 billion at the end of the review period. In accordance with the Currency Board principles, all changes in the Monetary Base had been fully matched by changes in foreign reserves.

     The Report on Currency Board Operations for the review period is at Annex.
 
Monitoring of Risks and Vulnerabilities
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     The Sub-Committee noted that as the US banking problem gradually stabilised and the US debt ceiling issues were eventually resolved, market attention had shifted back to the US inflation outlook. With the still-firm core inflationary pressures and resilient labour market conditions, markets had pared back expectations of rate cuts in the near term. However, the high-for-longer US interest rate outlook might expose other vulnerabilities in the global financial system. Meanwhile, there were concerns in the market over the quality of commercial real estate (CRE) loans to which small US banks had relatively high exposure, as the US CRE market faced pressures from ongoing shift to hybrid working and tightened lending standards.
      
     The Sub-Committee noted that Mainland China’s economic recovery showed signs of moderation moving into Q2 2023 amid weak private sector confidence, renewed softening in the housing market, and lingering funding pressures on local government financing vehicles. As for the Asia-Pacific region, the external environment remained challenging, with subdued export demand from the US and other major economies. 

     The Sub-Committee noted that in Hong Kong, economic activities resumed positive growth in Q1 2023 and improved further stepping into Q2 2023 as both inbound tourism and domestic demand recovered strongly along with the reopening of Mainland China and Hong Kong, as well as the disbursement of consumption vouchers. While the unemployment rate fell further to a very low level, the underlying inflation remained largely in check. It was expected that economic growth would rebound visibly in 2023, although the outlook would be subject to evolving risks relating to the US Fed’s policy rate path, the global economic environment and lingering geopolitical tensions. Meanwhile, following a strong rebound in Q1 2023, housing prices and transactions saw signs of stabilisation in Q2 2023 as market sentiment turned cautious amid rising interest rates. 
 
Transmission of Federal Reserve’s Dollar Liquidity Backstop Measures to the Hong Kong banking sector
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     The Sub-Committee noted a paper that studied the transmission of Federal Reserve’s dollar liquidity backstop measures to banks in Hong Kong. read more

     With the Beijing-Tianjin-Hebei region and Northeast China recently hit by severe rainstorms and floods, the Government of the Hong Kong Special Administrative Region (HKSAR) today (August 14) approved under the Disaster Re… read more