Hong Kong Dollar

The Hong Kong dollar is the official currency of Hong Kong. It is subdivided into 100 cents. The Hong Kong Monetary Authority is the governmental currency board and issues banknotes and coins in the Hong Kong dollar. The Hong Kong dollar is one of the most traded currencies in the world. It is also one of the world's highest-valued currencies. The Hong Kong dollar is pegged to the US dollar at a rate of 1 US dollar to 7.8 Hong Kong dollars. The Hong Kong dollar has a long history, dating back to the colonial era when it was first introduced in 1845. It replaced a variety of different currencies that were in use at the time, including the Mexican dollar, the Spanish dollar and the sterling silver dollar. The Hong Kong dollar was initially pegged to the silver standard, but this was abandoned in the 1930s during the Great Depression. The currency was then pegged to the British pound until 1972, when it was pegged to the US dollar. The Hong Kong dollar is used in Hong Kong and also in a number of other territories, including the Macau SAR and the People's Republic of China. In Hong Kong, the dollar is used for most transactions, although the Chinese yuan is also accepted. The Hong Kong dollar is a free-floating currency, meaning its exchange rate is not pegged to any other currency. However, it does maintain a close relationship with the US dollar. The Hong Kong Monetary Authority intervenes in the foreign exchange market to keep the exchange rate within a tight range of 7.75-7.85 Hong Kong dollars to 1 US dollar. The Hong Kong dollar is a popular currency for investment and speculation. This is due to the city's status as a global financial centre and its close link to the Chinese economy. The Hong Kong dollar is also used as a reserve currency by a number of central banks and institutions. This includes the Bank of China, the Hong Kong Monetary Authority and the Monetary Authority of Singapore.