Hong Kong's Exchange Fund recorded a loss of 33.5 billion HK dollars (US$4.3 billion) in the first quarter, Hong Kong Monetary Authority Chief Executive Joseph Yam said Thursday.
Yam told lawmakers that the loss was due to simultaneous unfavorable influences in the equity, bond and foreign-exchange markets, but he noted that the fund recovered the entire first- quarter loss by the middle of this month as financial markets around the world rebounded.
"In the current environment of global recession and given the fact the financial systems in the U.S. and Europe are still not yet functioning normally, it is likely the financial markets around the world will continue to be extremely volatile," he said.
"A conservatively managed fund with a size of over 1,500 billion HK dollars earning or losing 10 billion a day is not surprising," he said.
People should be psychologically prepared when looking at the short-term numbers, he said, adding the most important thing is to have a well established, suitably conservative investment strategy to ensure the fund can fulfill its statutory objectives. (1 U.S. dollar = 7.74 HK dollars)
(Xinhua News Agency May 22, 2009)
