Hong Kong Exchange Fund reports gains on equity investments in H1

HONG KONG, July 30 (Xinhua) -- Hong Kong's Exchange Fund recorded an investment income of 104 billion Hong Kong dollars (about 13 billion U.S. dollars) in the first half of this year, with positive return on equities amid market rallies, official data showed Tuesday.

The investment income included 57.9 billion Hong Kong dollars in gains on bonds, 6.6 billion Hong Kong dollars in gains on Hong Kong equities and 47.8 billion Hong Kong dollars in gains on other equities, the Hong Kong Monetary Authority (HKMA) said in a statement.

The gains on equities represented a reversal from losses for four quarters.

Total assets of the Exchange Fund stood at 3.98 trillion Hong Kong dollars by the end of June, a decrease of 37.9 billion Hong Kong dollars from the end of 2023. Accumulated surplus stood at 688.3 billion Hong Kong dollars by the end of June.

Eddie Yue, chief executive of the HKMA, noted that market optimism about interest rate cuts on the back of moderating inflationary pressures in major economies has driven major equity indices to new highs while the Hong Kong equity market also posted modest gains.

Looking ahead, factors such as future policy rate paths, global growth outlook and geopolitical tensions will continue to introduce uncertainties to the investment environment. The HKMA will continue to manage the Exchange Fund with prudence and flexibility, implement appropriate defensive measures, and maintain a high degree of liquidity, he said.

"We will continue our investment diversification to strive for higher long-term investment returns, and ensure that the Exchange Fund will continue to serve its purpose of maintaining monetary and financial stability of Hong Kong in an effective manner," he said.