No
well be the order of magnitude for the year as a whole (lust year's deficit was 1732m., 1975's was 3640m.) if surpluses in September and October cancel deficits in November and December.
5. Invisibles.
figures are yet available on these but net earnings (exports of services minus imports) must be of the order of HK$400,000 a month in 1977. It is very difficult for me to estimate these more accurately because the government intervened in exchange markets earlier this year, so that any appearance of equilibrium in the value of the HK could well be superficial.*
...
6. The Hong Kong Dollar. The World Bank (para. 3.46 main report) said:
the exchange rate is probably the single most important macroeconomic policy variable, that the Government can affect directly" and it is pleasing to know that the Financial Secretary regards it as an 'instrumental variable' or tool rather than as just another economic indicator over which he has no control. I think it should also be easier to control a currency where no-one (except officials) knows the size of official reserves since speculators have less information on which to guess and so do not take wild risks (ie not publishing each month's level of official reserves is a very good idea).
7. Last year the IK appreciated 6.5% relative to all major currencies and 7.2% relative to the US"; this year it began by continuing to appreciate too fast in the 's view, so the Exchange lund stepped in and sold HK's which moderated the rate of increase until in mid-March this was no longer
necessary.
Business had begun to realise that the phenomenal export growth of 1976 could not continue in 1975 that in fact
/world
E
*If the HK Government itself knew the value of invisible. earnings it would be able to know when the HK was correctly valued. At the moment it can only use intuition, like the bankers and businessmen.
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