Foreign Exchange Market Operations and Reserve Management: The Recent Experience of Hong Kong
8 Pages Posted: 13 Dec 2019
Date Written: October 31, 2019
This note reviews the recent experience of the Hong Kong Monetary Authority’s foreign exchange market operations and illustrates why such operations are a passive and mechanical process under the currency board arrangement. This note also discusses whether Hong Kong is well prepared for capital outflows following massive inflows that began in 2008, and concludes by discussing the rationale of the Hong Kong Monetary Authority’s reserve management.
Full Publication: Reserve Management and FX Intervention
Keywords: linked exchange rate system, convertibility undertaking, exchange rate system credibility, reserve management
JEL Classification: E52, E58, N1
Suggested Citation: Suggested Citation