Why do we have the Hong Kong dollars anyway? Isn't Chinese Yuan enough? Doesn't the $400B+ HK monetary reserve assets look attractive to China? Also, does having Hong Kong make China look divided?
https://nationalpost.com/news/world...ial-extradition-bill-despite-massive-protests https://www.businessinsider.com/hon...izing-extradition-bill-will-go-forward-2019-6 Hong Kong's leader Carrie Lam signaled Monday that her government will go ahead with proposed amendments to its extradition laws after a massive protest against them. Lam told reporters the legislation is important and will help Hong Kong uphold justice and fulfill its international obligations. Safeguards introduced in May will ensure that the legislation protects human rights, she added. When you look at Carrie Lam, that's the face of a sociopath... Record outflows for 2H 2019
Interesting trends happening, here are some graphs courtesy of HKTDC and TE HK Capital Flows in HKD Millions
https://www.scmp.com/business/banki...g-kongs-rates-curve-most-inverted-two-decades Expectations that liquidity will tighten in Hong Kong in the short term have helped drive the city’s interest rate swap curve into its deepest inversion since 1999. One-year interest rate swaps have climbed 19 basis points this week to 2.16 per cent, compared with 1.86 per cent for five-year contracts. The one-month interbank borrowing cost extended an advance on Thursday, jumping to the highest level since October 2008, amid seasonal demand for Hong Kong dollars. That has supported the currency. The premium of the one-year interest rate swaps against the five-year ones is at the widest since January 1999. Longer-dated contracts tend to reflect investors’ views of Hong Kong’s long-term growth prospects and capital flows.
https://www.forbes.com/sites/kenrap...-trade-relationship-with-the-us/#609e10df48ff Eight U.S. senators and two House representatives said they will reintroduce a bill that threatens to remove Hong Kong from its status as special trading partner with the United States. Were such a status to be removed, it would cut off a large flow of dollars into China and force international exporters to rethink whether to remain in Hong Kong or move to Singapore. The status change would also make it harder for mainland China companies to export at lower tariffs to the U.S. The effort is being led by the China uber-hawk, Florida Senator Marco Rubio. Four of the Senators who have agreed to reintroducing the bill for a vote were undoubtedly wooed by Rubio’s human rights angle, a favorite motivator to get liberal Democrats on board with “big stick” foreign policies like sanctions.
Bank of East Asia is down 8 %... https://sg.news.yahoo.com/brief-bank-east-asia-sees-090952274.html June 13 (Reuters) - Bank of East Asia Ltd: * EXPECTS TO REPORT A MATERIAL DECREASE IN PROFIT FOR SIX MONTHS ENDING 30 TH JUNE, 2019 * LIKELY DECREASE IN PROFIT IS ATTRIBUTABLE TO AN EXPECTED DOWNGRADE OF FOUR LEGACY LOAN ASSETS IN MAINLAND CHINA * BANK'S COMMON EQUITY TIER 1 (CET1) & TOTAL CAPITAL ADEQUACY RATIO AS OF 30TH JUNE, 2019 EXPECTED TO REMAIN ABOVE 14.5% AND 19% * DOWNGRADE TO RESULT IN SIGNIFICANT POST-TAX IMPAIRMENT LOSSES, ESTIMATED TO BE BETWEEN HK$2.5 BILLION AND HK$3.0 BILLION Source text for Eikon: Further company coverage:
Hk' s competitor isn't singapo, they are shanghai sginzhen Beijing. Even after the mess, global players are still longing for China businesses and hk remains the least dirty shirt to access China.
I think you are misreading the changing tide here. This is not gonna go back to same old. I think from the West's perspective a line in the sand has been crossed by China and major trading partners now demand from China to turn away from dishonest and deceptive trade practices. Because the US has made a strong case for a long term opposition to a rising China many global business are currently in the process of shifting entire supply chains and manufacturing away from China. This is not a temporary phenomenon but a lasting change. It started almost all with Supermicro, through major other computer manufacturers, now Apple, and soon entire car suppliers to South Asia and even Africa is under consideration.
I am talking about hk being a financial centre for China. Not about supplychain or real economy which hk doesn't have anyways
So what, as long as China keeps its market shit to foreign services including financial services what does it matter? Many global services firm were sitting here in HK for years doing nothing. Pension advisers, insurance firms, consultancies, investment banks even. Do you know how many transactions Credit Suisse gets done in a year here in Asia ex Japan? Hardly anything, particularly in China. They are probably losing money but the boss in Europe tells them to stick around just in case. I believe that case will not come around any time soon which means global firms will start to retreat from China en masse