The Hong Kong dollar’s link to the US dollar

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The Hong Kong dollar is a strange currency, although given how most
governments (sorry, central banks) run their currencies perhaps it
would be better if it was the norm.

Hong Kong does not have a central bank, although it does have a
[Monetary Authority](http://www.hkma.gov.hk). Instead, notes of 20
Hong Kong dollars and above are issued by three banks: HSBC (The
Hongkong and Shanghai Banking Corporation Limited), Standard
Chartered, and these days Bank of China. For every 7.8 Hong Kong
dollar issued, they must keep one American dollar in reserve. Simple,
really.

The recent shenanigans with the US dollar, however, have led people to
(again) consider whether this arrangement is in Hong Kong’s interest.
The Economist covered this issue reasonably well in two articles:

http://www.economist.com.hk/node/21525923

and

http://www.economist.com.hk/node/21530091

For my part, I wish everything was back on the gold standard…

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