Global financial markets in recent years, there have been a series of “black swans”, Hong Kong has been caught in the social unrest and chaos, the United States sanctions and take away the “halo” of special treatment, the Hong Kong Monetary Authority President Yu Weiwen just assumed office immediately to face many challenges, Hong Kong’s prospects are as critical as the eggs to make Hong Kong people to go to the capital risk aversion high, he said frankly in an interview with this newspaper, the flow of Hong Kong dollar funds is not easy to observe, and warned that we must beware of two major potential hidden worries, respectively, the market is expected to reappear in the United States Inflation and the sudden start of interest rate hikes; 2013 Federal Reserve Board because of the collection of water triggered by the “shrinkage panic” (Taper Tantrum) The resurgence. He also predicted that in February, Hong Kong dollar deposits entered the downward track.
Yu Weiwen will soon take over the HKMA for a year and a half, he said, Hong Kong does face a complex environment inside and outside, will be as said at the beginning of his term, to maintain financial stability as the primary goal.
Hong Kong capital inflow or outflow of each help, Yu pointed out that the future of a series of new stocks to be listed in Hong Kong or return to the Hong Kong market for a second listing, the move is likely to attract a lot of international investor interest, is expected to continue to focus on mainland enterprises listed in Hong Kong, to achieve diversified investment, coupled with the Epidemic in the Asian region tends to stabilize, that investors to choose economically developed regions, Asia will be the first choice, and then attract Funds will flow into the Hong Kong market.
However, the current very low interest rate environment for an unknown period of Time, and low interest rate environment resulting in high valuation of assets will not show a retracement, is not easy to predict, he proposed the following two major concerns are the market can not be ignored, said that the flow of international funds, and the emerging markets, including Asia’s capital flow reversal.
First, if U.S. inflation rises significantly, the market will be the U.S. Federal Reserve to raise interest rates or stop buying bonds appear larger expectations, if the market is expected to heat up, there is a chance that, as in the past few weeks, the phenomenon of rapid decline in high-valuation assets. He reminded that once asset prices fall, will spread quickly, especially when the adjustment of high-risk assets, fund managers will withdraw emerging market assets to safer asset classes, when the money will flow away from the Asian region, including Hong Kong.
Second, he is worried about the emergence of a replica of the “tapering panic”, the incident in 2013, the then chairman of the U.S. Federal Reserve Bernanke suggested that the central bank began to reduce the size of the monthly asset acquisitions (that is, to begin to “collect water”), when the U.S. Treasury yields rose sharply, the scourge of Global financial markets. Yu said, when the economic heat and inflation levels rise, the United States will need to adjust the strength of bond purchases, when the market understands that the United States to tighten monetary policy, and increase expectations for the dollar and the rise in U.S. interest rates, there is an opportunity for capital flows from emerging markets.
Once the above scenario, global capital flows will be very strong, but he stressed that the two situations may not necessarily occur, when the United States to reduce the purchase of debt no one knows. In the current situation, he believes that it is more certain that funds will flow through the new stock market, but it is difficult to estimate the flow of funds down the road.
“Foreign exchange funds do not invest in bitcoin.”
Digital currency emerged gradually by the global central bank attention, especially in China’s digital yuan (eCNY) research and development to go very far ahead, the HKMA president Yu Weiwen said, Hong Kong people apply for eCNY wallet method, transfer money way, etc., are part of the test scope, the current progress is good, hope to expand the next test points, so that more banks and customers to participate in it.
Since the end of last year, Hong Kong digital yuan-related cross-border technical tests, Yu pointed out that the test is mainly aimed at the retail level of daily use, including mainlanders to Hong Kong and Hong Kong people in the mainland how to use more convenient, revealing how to apply for eCNY wallet by Hong Kong banks, Hong Kong people’s wallets if the balance is insufficient, whether through the Hong Kong bank’s “transfer number fast “The first phase of technical testing is limited to the People’s Republic of China.
The first phase of technical testing, only the People’s Bank of China designated a Hong Kong bank, as well as a limited number of merchants to participate in the test, he believes that the current test is narrower in scope, hoping that the future can expand the scope, describing the use of the test in Hong Kong is not complicated. As for when the test can be used, he said it depends on the official timetable of the mainland, after all, the project involves the whole country, the currency is equivalent to the RMB banknotes, is a mega project that can not be faulted, all parties will be particularly careful and carry out multiple rounds of testing to ensure that the details are correct.
In the enterprise and international level application, he pointed out that the HKMA and international parties to establish a “variety of central bank digital currency cross-border network” (m-CBDC Bridge), hoping that through the central bank digital currency, in order to solve the cross-border funds transfer, international trade settlement problems, that this project is more complex, the more central banks and stakeholders The more central banks and stakeholders participate, the better.
For the virtual currency bitcoin in recent years, the epileptic rise, attracted global investors, recently rose through the $ 60,000 mark, the year-to-date rise of more than double, he said, bitcoin lack of monetary support, storage value function is not high, and not widely accepted as a medium of exchange for the purchase and sale of goods, the price fluctuations are too high risk is very big, but also non-statutory currency, said straight to bitcoin have doubts, called on investors do not blindly follow the wind to enter, stressed that the Exchange Fund will not invest in bitcoin. The foreign exchange fund will not invest in bitcoin.
If a bank has customers involved in bitcoin-related transactions or business, he reminded banks to provide payment or settlement services, in the anti-money laundering guidelines and requirements, banks must clearly know the source of funds, but fortunately, in recent years, the regulators are very strict on the relevant regulation, currently no bank has too much potential risk.
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