Second, Hong Kong implements a linked exchange rate system, that is, the issuance of Hong Kong dollars is linked to the US dollar. To issue Hong Kong dollars, a considerable amount of US dollars must be deposited to avoid the possibility of excessive issuance of Hong Kong dollars.
Currency board system. Hong Kong's linked exchange rate system belongs to the currency board system. Under this system, the flow and stock of the base currency must be supported by sufficient foreign exchange reserves, which can be achieved through a strict and stable currency board system. There is no real currency board in Hong Kong. Most banknotes are issued by the three major note-issuing banks, namely HSBC, Standard Chartered Bank and Bank of China (Hongkong). According to the law, note-issuing banks are required to submit the equivalent US dollars to HKMA at the exchange rate of HK$ 7.80 to US$ 65,438 +0, and the equivalent US dollars will be transferred to the Exchange Fund account to purchase bonds as support for issued bills. On the contrary, when the Hong Kong dollar bills are recovered, HKMA will redeem the bonds and the banks will recover the equivalent US dollars from the Exchange Fund. Banknotes and coins issued by the government through HKMA are stored by correspondent banks and distributed to the public. Transactions between HKMA and correspondent banks are also settled in US dollars, and the exchange rate is HK$ 7.80 to US$ 65,438+0.
What is Hong Kong dollars?
Hong Kong dollar, referred to as Hong Kong dollar for short, is the legal tender in circulation in Hong Kong. According to the Basic Law of Hong Kong, Hong Kong's autonomy includes the right to issue its own currency. Its official ISO 42 17 is abbreviated as HKD (Hong Kong dollars); The national flag is Hong Kong dollars.
65,438+00 yuan notes and coins are issued by the Hong Kong Monetary Authority, and 20 yuan and above Hong Kong dollar notes are issued by Bank of China, HSBC and Standard Chartered Bank. The denominations of banknotes in circulation are 10 yuan, 20 yuan, 50 yuan, 100 yuan, 500 yuan, 1000 yuan, and the denominations of coins are 10 yuan, 5 yuan, 2 yuan, 1 yuan, 5 cents, 2 cents,/kloc. 1 yuan = 10mm = 100m. In Hong Kong, "Hao" means "Jiao".
20 18 on July 24th, the Hong Kong Monetary Authority and three Hong Kong note-issuing banks, namely Bank of China, HSBC and Standard Chartered Bank, announced the launch of a new version of the 20 18 series of Hong Kong dollar banknotes.
Hong Kong has established a linked exchange rate system linking the Hong Kong dollar to the US dollar. Dollars held by the Exchange Fund support the stability of Hong Kong dollar bills.