Hong Kong's Monetary Authority Chief Executive Norman Chan announced Wednesday (Jan 26) that the city's Exchange Fund investment yielded 79 billion HKD in 2010, with the investment return standing at 3.6 percent.
After deducting interest and other expenses, the net investment income in 2010 was 74.4 billion HKD, Chan said.
According to the official, the 2010 Exchange Fund investment return was 3.6 percent, above the average return of last three years of 1.2 percent, but falling short of the last five-year average of 4.9 percent.
The total assets of the Exchange Fund increased to some 2.35 trillion HKD at the end of 2010, said Chan, adding that the increase is mainly due to the increase in placements received from fiscal reserves, government funds and statutory bodies.
Chan also said the accumulated surplus recorded an increase of 37.9 billion HKD and the fee payments to the Fiscal Reserves amounted to 33.8 billion HKD.
Chan said that following the speech of the US Federal Reserve Chairman in August to provide additional monetary accommodation if it proves necessary, the global equity market rebounded sharply, leading to a turnaround in the investment performance of the Exchange Fund in the second half of the year.
Regarding the outlook for the year ahead, he believed the emerging market economies are facing pressure from capital inflow, rising domestic price inflation as well as asset price inflation.
