4000035
P.R. 3
HONG KONG GOVERNMENT
NFORMATION SERVICES
DAILY INFORMATION BULLETIN
SUPPLEMENT
Thursday, July 6, 1972
FIXED HONG KONG DOLLAR RATE WITH U.S. DOLLAR
A fixed rate has been established between the Hong Kong dollar and the
U.S. dollar of HK$5.6500 to US$1, representing a revaluation of the Hong Kong
dollar against the closing rate for sterling on the London market yesterday of
approximately 5.2 per cent.
Announcing this decision this evening the Financial Secretary, Mr.
C.P. Haddon-Cave said: "This is a temporary measure which will last only as
long as the pound sterling continues to float",
"A new fixed rate between the Hong Kong dollar and sterling will be
re-established when the British Government announces a new fixed rate for
sterling with the U.S. dollar," he added.
In the meantime, the Hong Kong Government will stand ready to maintain
the new rate of the Hong Kong dollar with the U.S. dollar within limits of 2% per
cent around this middle rate as provided for under international practice
sanctioned by the International Monetary Fund. The upper limit will be HK$5.5229/
US$1 and the lower limit HK$5.7771/US$1.
"The fact that this move can be made", Mr. Haddon-Cave said, "is a
measure of the strength of the Hong Kong dollar and of the resilience of the
Hong Kong economy. I am sure that the rate we have chosen in relation to the
U.S. dollar is the right one in our circumstances and that it can be maintained.
It will help to stabilise the prices of our imports, and hence our cost of living
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but will at the same time be such as to maintain the competitiveness of our exports
which is the basis on which the expansion of the economy depends."
/Explaining