TNAG-2467-FCO40-3591-Economic-situation-in-Hong-Kong-1992 — Page 14

7.

In the first ten months of 1992, domestic exports to China surged further in value terms, while those to the United States recovered to show further growth. On the other hand, the value of domestic exports to Germany, the United Kingdom and Japan were still on a downtrend.

Labour market

8.

The seasonally adjusted unemployment rate and the underemployment rate were both 1.9% (provisional) in the three months ending November. Both were 0.1 of a percentage point lower than in the preceding three months.

Prices

9.

The year-on-year rate of increase in the CPI(A) moderated to 9.5% in October, after a temporary relapse to 9.9% in September. The moderation was mainly due to the prices of fresh vegetables returning to a lower level following the unusually sharp rise in the preceding month.

Financial sector

10.

Local money market interest rates edged up further in November. This At end- mainly reflected the concurrent firming up of US dollar interest rates. November, the 3-month interbank rate rose to 4 3/4%, 15/16 of a percentage point higher than a month earlier. Meanwhile, its Eurodollar counterpart edged up by 15/32 of a percentage point to 3 31/32%. The differential between the two rates thus widened to 25/32 of a percentage point in favour of the Hong Kong dollar interest rate at end-November, from 5/6 of a percentage point at end-October.

11.

The various deposit rates administered by the Hong Kong Association of Banks remained unchanged in November. At the end of the month, the savings, 3-month and 12-month deposit rates were 1 1/2%, 2 3/4% and 3 3/4% respectively. The best lending rate stood at 6 1/2%.

12.

The market exchange rate of the Hong Kong dollar against the US dollar fluctuated within a narrow range of HK$7.73_to_HK$7.74 per US$ during November. Against other major currencies, the exchange value of the Hong Kong dollar strengthened somewhat, following the movement of the US dollar. The effective exchange rate index edged higher to 114.0 at end-November, from 112.1 at end- October.

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