The Monetary Authority: Will make appropriate defensive deployments for the foreign exchange fund, maintaining high liquidity and diversified investments

The foreign exchange fund recorded an investment income of HKD 331 billion in 2025. The President of the Hong Kong Monetary Authority, Richard Yu, stated that it is very rare for all major components of the foreign exchange fund to achieve positive returns simultaneously, having only occurred in 2017 and 2020 over the past 15 years.

Richard Yu pointed out that the special circumstances of multiple favorable factors in the global market in 2025 may not be sustainable in the long term. Looking ahead to 2026, factors such as global economic conditions, monetary policies of major central banks, the development of artificial intelligence, and geopolitical conflicts may all impact the performance of financial markets. If conditions worsen, significant volatility may occur in the financial markets.

He continued to state that in the face of a complex and changing investment environment, the Hong Kong Monetary Authority will make appropriate defensive deployments, maintain high liquidity, and continue to diversify investments, aiming to enhance the long-term investment returns of the foreign exchange fund to ensure it can effectively maintain Hong Kong's monetary and financial stability. He believes that the allocation of the foreign exchange fund needs to focus on long-term returns, thus diversifying currency investments and making longer-term risk distributions to reduce the correlation between assets.

The Chief Executive Officer of the Foreign Exchange Fund Investment Office, Li Dazhi, also mentioned that the asset size of the foreign exchange fund is large, so investments cannot be made in and out significantly, but investments will be diversified to reduce risks. Among them, the US dollar still accounts for a large portion of the foreign exchange fund's investment portfolio, and due to the peg between the Hong Kong dollar and the US dollar, a considerable amount of US dollar assets will be held