Hong Kong residents are rushing to change their Hong Kong dollars to US dollars after the Chinese legislature passed a resolution on a national security law for Hong Kong. Money changers have to ask hundreds of customers to leave as they run out of the US dollars.
Demand for the US dollars has been raised in Hong Kong. Money exchangers have to ask their customers to leave since no US dollars can be exchanged in their stores.
Money exchange store owners noticed the demand for US dollars increased the Chinese legislature passed a resolution on a national security law for Hong Kong. Residents feared that the linked exchange rate system with the US dollar will be dismantled when US Secretary of State Mike Pompeo said Hong Kong was not suitably autonomous from mainland China.
“I’m not confident about the current situation. In case the US dollar peg is reset, buying the US dollar beforehand provides me more confidence,”The 35-year-old British National (Overseas) passport holder said
Hong Kong Monetary Authority chief executive Eddie Yue Wai said the exchange system with the US is fundamental in Hong Kong’s financial system with foreign reserves of more than US$440 billion. Also, there is no sign that fund outflows from the Hong Kong dollar or banking system.