HK dollar deposits and foreign currency deposits decreased by 0.6% and 0.9% respectively

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30th June 2022 – (Hong Kong) According to statistics published today by the Hong Kong Monetary Authority, total deposits with authorised institutions decreased by 0.7 per cent in May 2022. Among the total, Hong Kong dollar deposits and foreign currency deposits decreased by 0.6 per cent and 0.9 per cent respectively, driven by fund flows of corporates. In the year to end-May, total deposits remained virtually unchanged and Hong Kong dollar deposits rose by 1.0 per cent. Renminbi deposits in Hong Kong increased by 1.0 per cent in May to RMB850.4 billion at the end of May. The total remittance of renminbi for cross-border trade settlement amounted to RMB777.3 billion in May, compared with RMB742.5 billion in April. It should be noted that changes in deposits are affected by a wide range of factors, such as interest rate movements and fund-raising activities. It is therefore more appropriate to observe the longer-term trends, and not to over-generalise fluctuations in a single month.

 ​Total loans and advances increased by 0.5 per cent in May, and grew by 1.0 per cent in the year to end-May. Among the total, loans for use in Hong Kong (including trade finance) and loans for use outside Hong Kong increased by 0.6 per cent and 0.1 per cent respectively in May. The Hong Kong dollar loan-to-deposit ratio increased to 86.5 per cent at the end of May from 85.6 per cent at the end of April, as Hong Kong dollar deposits decreased while Hong Kong dollar loans increased.

 Hong Kong dollar M2 and M3 both declined by 0.7 per cent in May. Compared to a year ago, Hong Kong dollar M2 remained virtually unchanged while Hong Kong dollar M3 edged down by 0.1 per cent. The seasonally-adjusted Hong Kong dollar M1 decreased by 2.5 per cent in May, and decreased by 0.8 per cent compared to a year ago, reflecting in part investment-related activities. Total M2 and M3 both dropped by 0.7 per cent in May, but both increased by 1.9 per cent from a year earlier.

 As monthly monetary statistics are subject to volatilities due to a wide range of transient factors, such as seasonal and IPO-related funding demand as well as business and investment-related activities, caution is required when interpreting the statistics.

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