M2 or CPI: what does “the value of HKD” actually mean?
Compare money-supply share and consumer purchasing power, with a worked example and a checklist for reading HKD calculations.
Read more →Notes
Practical explanations of money supply, prices and exchange rates, with sources and calculators.
Hong Kong 2026 GDP growth forecast: how the government and IMF revised it
The IMF now projects 3.8% growth for Hong Kong in 2026 and the government 3.5% to 4.5%, up from 2.1% and 2.5% to 3.5%. Every revision since October 2025 with dates and stated reasons, the actual 5.9% and 4.3% quarters, the Q3 release, and how Korea's forecasts lagged in the same way.
Read more →Hong Kong GDP vs GNI in 2026: did the terms of trade add to the city's income?
Hong Kong's real GNI grew 5.3% in Q2 2026 against real GDP growth of 4.3%. What GDP, GNI and GDI measure, why the gap here comes from overseas investment income rather than export prices, how flat the terms of trade stayed through the AI trade boom, and how this compares with Korea.
Read more →MPF returns over 10 years: did they beat inflation and money supply in Hong Kong?
Chaining the MPF system's net returns for 2016-2025 gives about 4.47% a year: HK$1 million became about HK$1.55 million. Prices rose 18.3% and Hong Kong dollar M2 rose 53.2% over the same decade, so the MPF beat inflation comfortably but beat money supply by only about 1%, and only because of 2025. Year-by-year figures, what reaches your own account, and 2026 so far.
Read more →Rice prices in Hong Kong dollars: how high is the world price in history, and why has local rice CPI fallen?
Thai 5% white rice averaged US$471 a tonne in August 2026, or about HK$3,694 a tonne and HK$3.69 a kilogram, the 102nd-highest of 548 months since 1981 and 47.7% below April 2008. Under the peg the Hong Kong dollar barely changed the 12-month rise, while the rice component of Hong Kong's CPI fell 1.1% in September.
Read more →Gold in Hong Kong dollars: about 26% below the January peak, almost the same as in US dollars
Gold has fallen about 26% from its 29 January 2026 record in US dollars, and about the same in Hong Kong dollars, because the peg keeps the exchange rate almost fixed. How the fall compares with past gold bear markets in HKD, how long recoveries took, and how far gold is still above 2019.
Read more →Hong Kong inflation vs the US: 1.9% against 3.7%, with the same interest rates
Hong Kong's consumer prices rose 1.9% in the year to September 2026, against 3.7% in the US. The peg ties Hong Kong's rates to the Fed, but not its prices. How often Hong Kong has been lower since 2020, where the gap comes from, and what it means for a US dollar amount held in Hong Kong dollars.
Read more →France now borrows above Italy. Why is Hong Kong's 10-year yield close to 4% with a fraction of the debt?
France's 10-year yield reached 4.79% on 16 October 2026, above Italy's. Hong Kong's government debt is 14.1% of GDP on IMF figures, against France's 118.5%, yet its 10-year was 3.996%. Debt, deficits, growth, ratings and why the peg matters more than the ratio.
Read more →MSCI market classification explained: developed, emerging, frontier and what it means for Hong Kong
MSCI classes Hong Kong as a developed market, where it is 0.43% of the World index, yet Hong Kong-listed Chinese shares sit in the emerging markets index. How classification works, why it moves money, and what Indonesia's proposed move to standalone status shows.
Read more →HKMA Base Rate vs the Fed: why the gap is 25 basis points, and what the October FOMC could change
Hong Kong's Base Rate is 4.25%, 25 basis points above the Fed's 4.00% upper bound, because a published formula keeps it there. How the gap compares across Asia, what it looks like after inflation, and what the 27-28 October FOMC could mean.
Read more →Brent oil in Hong Kong dollars: how high is it in history, and how much has reached petrol prices?
Brent averaged HK$916 a barrel in September 2026, the 10th-highest month since 1981 but still below July 2008. Under the peg the Hong Kong dollar added only 0.8% to the rise. Standard petrol is up 20.2% since the end of 2025.
Read more →Does AI spending push up interest rates? What reaches Hong Kong
Big Tech plans about US$720-745 billion of capital spending in 2026 and is borrowing heavily to fund it. US real 10-year yields rose 97 basis points this year while inflation expectations rose 11. Under the peg, Hong Kong imports the rate effect; the price effect is muted.
Read more →Global bond yields 2026: US, UK, Germany and Japan at multi-year highs. Where is Hong Kong?
The US 10-year reached 5.31%, its highest since 2002, and Japan's passed 3% for the first time since 1996. Hong Kong's 10-year rose 92 basis points this year to 4.045%, its highest daily level since November 2023, but still below the 4.25% Base Rate.
Read more →Yen carry trade explained: what Japan at 3% means for Hong Kong
A yen carry trade borrows cheap yen to buy higher-yielding assets. On 5 August 2024 its unwinding sent the Nikkei down 12.4%; the Hang Seng fell 1.46%. Because the Hong Kong dollar is pegged, yen swings pass almost directly into HKD prices of Japanese goods and travel.
Read more →Hong Kong vs US 10-year yield gap: why it moves HIBOR, not the Hong Kong dollar
Hong Kong's 10-year yield was 119 basis points below the US in August 2026. Under the peg the exchange rate barely responds, with a correlation of −0.04 between yearly changes. What follows the US is Hong Kong's own yields, with a correlation of 0.85 since 2016.
Read more →Hong Kong yield curve: 10-year minus 2-year at 23bp, and what inversions have signalled
Hong Kong's 10-year minus 2-year government bond spread fell to 23.4 basis points in September 2026, against an average of 101.7 since 1996. Past inversions arrived with downturns rather than ahead of them, and mostly mirrored the US curve.
Read more →Hong Kong 10-year bond yield: highest since February 2025, yet 140th of 359 months
Hong Kong's 10-year government bond yield averaged 3.71% in September 2026, the highest monthly average since February 2025. Against 359 months since 1996 it ranks 140th, and it still sits below the HKMA Base Rate of 4.25%.
Read more →S&P 500 monthly DCA in Hong Kong: HK$3,000 a month for 10 years became HK$763,919
Investing HK$3,000 on the first US trading day of every month from October 2016 to September 2026 turned HK$360,000 into HK$763,919 in the S&P 500 and HK$1,055,737 in the Nasdaq-100. Because of the US dollar peg, the Hong Kong dollar result is almost the US dollar result, so index choice and timing decide the outcome.
Read more →Hong Kong's HK$407.9bn surplus: where the money goes, and why the HKD sat near 7.85
Hong Kong ran a current account surplus of HK$407.9 billion in 2025, about 12% of GDP, yet the HKD twice drifted to the weak side of the peg. Balance of payments data show residents invested more than the surplus abroad; under the peg the flows show up in HKMA operations, the Aggregate Balance and HIBOR, not the exchange rate.
Read more →US stocks in Hong Kong dollars: why the peg left S&P 500 returns at +20.6%
From August 2025 to August 2026 the S&P 500 rose 20.3% in US dollars and 20.6% in Hong Kong dollars. The Linked Exchange Rate System keeps the HKD between 7.75 and 7.85, so the currency barely matters. What the HKD's 2026 drift toward 7.85 does and does not mean.
Read more →What is chipflation? Hong Kong PS5 up 43%, CPI 1.7%
Chipflation is AI data centres soaking up memory chips and lifting gadget prices. Hong Kong's PS5 Digital rose 43%, yet August inflation was just 1.7%.
Read more →When will Hong Kong's 2026 rate rise reach mortgages?
The HKMA raised the Base Rate to 4.25% on 17 September 2026, but HIBOR stayed near 2.50% and banks held Prime. What it means for mortgages, and typical lags.
Read more →Why a rate rise does not shrink the stock of money
The Fed raised rates on 16 September 2026, yet US M2 growth rose from 4.04% to 5.41% over the same months. A policy rate pushes a money stock in two opposite directions at once, and under the Linked Exchange Rate System Hong Kong receives that rate from outside.
Read more →Policy rates and ten-year yields across 11 markets
Hong Kong's ten-year yield of 3.85% sits below its Base Rate of 4.00%, a gap of minus 15 basis points. Only Hong Kong and Taiwan are inverted this way, and in Hong Kong the policy rate is set by a formula rather than by local conditions.
Read more →Hong Kong is the control case — with a pegged currency, per-visitor spending falls by the same amount in HK dollars and in US dollars
Overnight visitors spent HK$5,503 each in 2025, down 5.4% from 2019. In US dollars the same figure is down 4.9%. Elsewhere in Asia the two numbers diverge sharply, and in Taiwan they carry opposite signs.
Read more →Hong Kong publishes no household balance sheet — what it does publish is HK$20.6 trillion of deposits and HK$1.67 trillion of MPF
No Hong Kong authority compiles a household financial balance sheet, so there is no official answer to what share of household assets sits in deposits. The measured pieces are customer deposits with authorized institutions, MPF net assets and long term insurance assets — three different universes that cannot be added.
Read more →Hong Kong's cash pile keeps growing — and nobody measures how much of it gets spent
Currency in circulation rose from HK$208.9 billion in 2009 to HK$672.6 billion in July 2026, and its share of M2 went from 5.82% to 7.25%. What Hong Kong does not have is any official measure of how much of payment is made in cash — so only half of this question can be answered here.
Read more →Hong Kong holds reserves worth a full year of GDP — and fails the textbook debt test
At the end of 2025 Hong Kong's official foreign currency reserve assets equalled 100.1% of GDP, the highest ratio in the region. On the classic Guidotti–Greenspan test the same market reads 289.2%, which would be a warning anywhere else. Both numbers are true, and this note explains why.
Read more →How far did the Hong Kong dollar fall in each crisis? Under 1% every time
Across five crisis episodes since 1997 the Hong Kong dollar's monthly average never moved more than 0.8% against the US dollar. That makes the exchange rate the wrong place to look for the shock — this note shows where it went instead.
Read more →When money growth falls and prices keep rising
A policy rate reaches prices through credit and the money supply, not directly. Trace that path, then read the months when Hong Kong and US money growth fell while consumer prices kept rising.
Read more →When prices rise, where does the lost purchasing power go?
Hong Kong CPI rose 1.65% in the year to 2026-07 while HK-dollar M2 reached HK$9,283.6 billion. This note explains which side of the balance sheet gains, and why Hong Kong is the market where we can only answer half the question.
Read more →A payout fixed today, collected in 20 years: what is it worth?
A sum assured, a fixed annuity or a guaranteed maturity value fixes a number, not a value. Here is what 2006-06 → 2026-06 of money supply and consumer prices did to a HK$1,000,000 payout in Hong Kong, and what each benchmark cannot tell you.
Read more →Money supply keeps rising, so is buying assets now always the better move?
Hong Kong's M2 rose 29.6% between April 1997 and December 2003 while consumer prices fell 11.1%. Four global rate regimes show which asset won and why the answer is not automatic.
Read more →How a supply shock reaches your currency
Freight, refining, inflation, bond yields, exchange rate: the 2026 energy shock traced through five measurable steps, and what each step does not tell you.
Read more →Why exchange rates change a US benchmark expressed in HKD
Follow the three-step conversion from HKD to USD and back, and see how currency movements can change a money-value comparison.
Read more →Why the M2 counter moves: reading the HKD trend estimate
Understand the clock-based M2 projection, its reference month, annual growth assumption and the difference from published statistics.
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