From left to right: HKMA Deputy Chief Executive, Mr Eddie Yue; AMRO Director, Dr Junhong Chang; HKMA Chief Executive, Mr Norman Chan; and AMRO Chief Economist, Dr Hoe Ee Khor

An AMRO mission led by Ms Chuin Hwei Ng conducted this year’s Annual Consultation Visit to Hong Kong, China1 from September 19 to September 23. Dr Junhong Chang, AMRO Director, and Dr Hoe Ee Khor, AMRO Chief Economist, participated in the policy discussions. During the visit, AMRO staff met with the Hong Kong Monetary Authority (HKMA) and public agencies, international financial institutions, and private sector financial institutions.

During the meetings, AMRO staff discussed a wide range of issues regarding Hong Kong’s economy, including the current economic outlook, recent developments in its financial and property markets, risks and growth prospects, and policy responses by the authorities. AMRO Director Dr Junhong Chang made courtesy calls on Mr Norman Chan, HKMA Chief Executive and on Mr Eddie Yue, HKMA Deputy Chief Executive, and had a fruitful exchange of views.

The AMRO mission team presented its preliminary assessment to the HKMA, and a final report would be prepared when the team returns to Singapore. In its preliminary assessment, the economy is forecast to slow to 1.4 percent this year due to the challenging external outlook. While the banking system is well-capitalized and fiscal reserves are ample, the risk of negative spillovers from the impending U.S. interest rate upcycle and the moderation in mainland growth remains.

AMRO encouraged the authorities to deploy more fiscal measures to support economic growth. On the property market, AMRO supported the authorities’ continued use of macro-prudential and demand management measures, in order to safeguard financial system soundness and to avoid excessive household leverage. AMRO would like to express our appreciation to the HKMA for its strong support for AMRO. The visit to Hong Kong has further strengthened our bilateral relationship with the Hong Kong authorities, as well as deepened our understanding of the macroeconomic and financial situation in Hong Kong.