(Fighting New Crown Pneumonia) Hong Kong Monetary Authority: Epidemic brings significant downside risks to Hong Kong economy
China News Agency, Hong Kong, March 30. The Hong Kong Monetary Authority (HKMA) issued a report on the 30th, stating that it is expected that Hong Kong's economic performance will face great challenges this year, and the new crown pneumonia epidemic has recently brought significant downside risks.
On the same day, the HKMA published the "Hong Kong Monetary Authority Quarterly" (Quarterly) and the "Semi-annual Report on Monetary and Financial Stability" (Semi-annual Report) in March this year.
In the semi-annual report, the HKMA said that since the industries of retail, accommodation services, food services, tourism and transportation have not recovered after the damage caused by social events last year, the epidemic will bring a double blow to these industries. In view of the weak economic outlook and the outbreak, the unemployment rate will further rise.
The HKMA said that global economic growth and weak trade activities will continue to weigh on Hong Kong's foreign trade performance, especially the epidemic may lead to regional supply chain disruption and slowdown of cross-border economic activities (such as tourism), thereby limiting Hong Kong's export performance.
According to the HKMA, given the strong exchange rate of the Hong Kong dollar, the stability of the balance and the moderate increase in total deposits, no significant outflow of funds from the Hong Kong dollar or the Hong Kong banking system was observed during the period under review. However, the agency needs to monitor the impact of further deterioration of the epidemic if the external environment is uncertain.
According to the HKMA, Hong Kong has a huge foreign exchange reserve and a stable banking system. It has the ability, resources and determination to cope with capital outflows and maintain Hong Kong's currency and financial stability.
In the quarterly report, the HKMA published an article entitled "Overview of Hong Kong's Bond Market 2019".
The HKMA said that Hong Kong's local bond market may continue to face resistance this year, especially the continuing economic and trade friction between China and the United States and the outbreak of the epidemic that has caused Hong Kong's economic slowdown. Company investment may be affected, which in turn will affect the amount of debt issuance and increase credit risk.
However, the HKMA said that there are still many favorable developments in the retail bond market, and several batches of retail bonds will be issued during the year. The council will continue to promote the development of Hong Kong's local bond market through the implementation of the Government Bond Scheme, the Government Green Bond Scheme and other different measures. (Finish)