Tuesday, September 25, 2007
Hong Kong's Money...
Want to know how monetary policy is really set in Hong Kong, and the intricacies of the Currency Board system? Look no further than "Hong Kong's Money," a new book written by Tony Latter and Published by Hong Kong University Press. Mr Latter is a former Deputy Chief Execuative of the Hong Kong Monetary Authority, and his association with monetary policy stretches back to the formation of the currency board in 1983. But his understanding of Hong Kong's monetary history stretches back a long way before then....
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3 comments:
I am a bit confused, if hk uses the currency board system to affect the monetary base, does this mean the monetary policy is targeting both money supply and the exchange rates, or is linked exchange rate is the only main focus?
Just the exchange rate. But keeping the exchange rate fixed will involve varying the monetary base- in this case, 1-for-1 with changes in the exchange fund.
notwithstanding that fact that currency peg is very political, are there any compelling reasons why HK$ should not be unpegged from US$, particularly in view of expected further depreciation of the greenback?
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