The Hong Kong Monetary Authority said on Friday it chalked up an income of HK$18.6 billion from Exchange Fund investments in the third quarter as its chief executive warned of uncertainties in the fourth quarter.

Gains from investments in Hong Kong stocks came in at HK$9.1 billion while the return from bond investments only amounted to HK$300 million.

Investments in other equities contributed HK$1.5 billion while foreign exchange investment brought HK$7.7 billion.

The authority said total investment income in the first three quarters of this year amounted to HK$171.9 billion.

Speaking after attending a meeting of the Legislative Council’s financial affairs panel, authority chief executive Eddie Yue said the fund's performance would continue to fluctuate this quarter, describing it as a “difficult quarter with uncertainties”.

The uncertainties run the gamut from Middle East tensions, financial conditions in major markets, to developments on the artificial intelligence front.

“The US midterm election results have drawn market attention to whether the AI build-out and data-centre construction will slow down, as many states appear to be resistant to it,” Yue pointed out.

“This also contributed to the volatility in the stock market [on Thursday night].”

However, Yue emphasised that the Exchange Fund is a long-term venture and that people should look at its long-term returns rather than focus on short-term results.

The authority, he also stressed, has been maintaining a diversified allocation of assets to make the portfolio more defensive.


Edited by Aaron Tam