Core Viewpoint - The Hong Kong Monetary Authority (HKMA) reported a significant increase in the foreign exchange fund's total assets and investment income for the first half of 2025, despite a challenging global investment environment [1][2]. Group 1: Financial Performance - As of June 30, 2025, the total assets of the foreign exchange fund reached HKD 42,971 billion, an increase of HKD 2,161 billion compared to the end of 2024 [1]. - The cumulative surplus of the foreign exchange fund stood at HKD 8,779 billion [1]. - The investment income for the first half of 2025 was HKD 1,944 billion, with bond investment income contributing HKD 753 billion, and stock investment income from Hong Kong and other sources totaling HKD 503 billion [1]. Group 2: Investment Environment - The first half of 2025 was marked by significant volatility in global financial markets due to trade barriers, geopolitical tensions, and the unpredictable stance of the U.S. government on economic policies [2]. - Despite the challenges, there was a recovery in global stock markets as negotiations on tariffs progressed, and the U.S. Federal Reserve maintained its monetary policy targets [2]. - The HKMA emphasized the importance of a cautious and flexible management approach to the foreign exchange fund, focusing on capital preservation and long-term value enhancement [2].

Group 1 - The Hong Kong Monetary Authority reported an investment income of 194.4 billion HKD for the first half of 2025 [1] - As of June 30, 2025, the total assets of the Hong Kong foreign exchange fund reached 4,297.1 billion HKD, an increase of 137.7 billion HKD from the previous month [3] - The cumulative surplus of the foreign exchange fund stands at 877.9 billion HKD [1] Group 2 - The HKMA's CEO noted that progress in tariff negotiations between the US and major economies has stabilized investor confidence and led to a recovery in global stock markets [3] - The bond market benefited from the Federal Reserve maintaining its monetary policy targets, resulting in high yields for dollar-denominated bonds held by the foreign exchange fund [3] - The depreciation of the US dollar against major currencies in the first half of the year contributed to significant foreign exchange valuation adjustments for the fund's assets [3] Group 3 - The HKMA acknowledged a 0.9% month-on-month increase in total deposits from recognized institutions in June, with a 0.9% decrease in HKD deposits and a 2.4% increase in foreign currency deposits [3] - The investment environment for the second half of the year remains uncertain due to unpredictable US government trade policies and potential geopolitical tensions [3] - The HKMA will continue to adhere to a "capital preservation first, long-term value enhancement" principle and make appropriate defensive arrangements [3]