3.17
Because of the linked exchange rate system, the exchange value of the Hong Kong dollar against other foreign currencies was affected by changes in the value of the US dollar in the foreign exchange market. During the third quarter, the US dollar followed generally a downtrend against most other major currencies. On the other hand, the Renminbi
was devalued sharply against the US reflecting these developments, the rate index of the Hong Kong dollar fell gradually from 65.4 at the end of June to 63.9 on 20 September, before closing the quarter at 64.4.
The securities and gold markets
3.18
dollar (14)
Largely trade-weighted exchange
Share prices rose rapidly in active trading during the third quarter. Speculation about favourable company results and take-over bids, a firm property market, low and falling interest rates, and an inflow of funds provided strong support to the upsurge in share prices. At the end of September the Hang Seng Index stood at an unprecedented high of 2 068, which was 19% higher than at the end of June 1986. For the third quarter as a whole total turnover amounted to $29,756 million, 34% higher than in the previous quarter. at end-September 1986, the total market capitalization amounted to $334 billion.
3.19
As
On 22 September 1986, the Stock Exchange of Hong Kong was admitted as а full member of the Paris-based
Federation Internationale de Bourses de Valeur (FIBV). This
membership enhances further Hong Kong's role as international financial centre, as the Stock Exchange of Hong Kong is now recognised internationally.
an
/3.20
(14)
The Renminbi was devalued by 13.6% against the US dollar (and by the same magnitude against the Hong Kong dollar) on 5 July 1986. particular devaluation had the effect of pushing the trade-weighted exchange rate index up by almost one percentage point.
This
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