According to the Hong Kong Monetary Authority (HKMA), total deposits in Hong Kong’s licensed institutions increased by 1.1% in May 2024. According to data released on June 28, Hong Kong dollar deposits increased by 0.3% and foreign currency deposits increased by 1.8%.
Deposit growth rate and Yuan trend
As of the end of May, total deposits increased by 3.2% compared to the previous year, and Hong Kong dollar deposits increased by 0.9%. In particular, Hong Kong yuan deposits surged 4.2%, reaching 1.134 trillion yuan. This increase is primarily due to corporate funding flows. However, the total amount of yuan remittances for cross-border trade payments decreased from 1.257 trillion yuan in April to 1.1832 trillion yuan in May.
The HKMA stressed that deposit fluctuations are influenced by a number of factors, including interest rate fluctuations and fundraising activities, so it is important to observe long-term trends rather than draw conclusions from monthly fluctuations.
Loans and Advances
In contrast to the increase in deposits, total loans and advances fell 0.4% in May and 2.4% in the year to the end of May. Loans used within Hong Kong, including trade finance, decreased by 0.3%, while loans used outside Hong Kong decreased by 0.7%. As a result, the Hong Kong dollar loan-to-deposit ratio decreased from 82.1% at the end of April to 81.4% at the end of May.
currency tally
Hong Kong dollar M2 and M3 both increased by 0.4% in May, up 1.5% compared to the same period last year. However, the seasonally adjusted Hong Kong dollar M1 fell 0.1% in May and 8.4% year-on-year, partly due to investment-related activity. Total M2 and M3 increased 1.2% in May and 7.8% year-on-year.
The HKMA cautioned that monthly currency statistics may fluctuate due to various temporary factors such as seasonal demand, IPO-related funding, business or investment activities, etc. Therefore, these statistics should be interpreted with caution.
For further information, please see the full report on the Hong Kong Monetary Authority website.
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