HKMA Eyes Greater Gold Allocation in Exchange Fund to Diversify Risk
Bastillepost · 2 SOURCESabout 3 hours ago4 MIN
Summary
The Hong Kong Monetary Authority is examining whether to moderately increase gold holdings in the Exchange Fund, according to remarks by HKMA Chief Executive Eddie YUE (余偉文) on September 17, 2026. The proposal, outlined in the latest Policy Address, seeks to diversify the Exchange Fund's risk profile while bolstering Hong Kong's position as a gold market hub. YUE indicated the study focuses on the Investment Portfolio, which already holds a small amount of gold alongside other precious metals and commodities .
Key Points
- The Policy Address proposes that HKMA study moderate increases in Exchange Fund gold holdings and participation in Hong Kong spot and futures markets .
- The Exchange Fund comprises a Support Portfolio holding USD-denominated high-liquidity assets and an Investment Portfolio with diversified assets including precious metals and commodities .
- YUE said the current proposal examines whether to increase gold allocation in the Investment Portfolio, which already contains a small amount of gold .
- The HKMA plans to gradually transfer existing gold reserves to designated warehouses of the Hong Kong Gold Settlement Company .
- YUE stated the initiative aligns with the HKSAR Government's direction of developing gold and commodities markets .
Why It Matters
This study represents a strategic shift in Hong Kong's reserve management approach, potentially strengthening the city's gold market ecosystem by integrating Exchange Fund holdings with local market infrastructure. The initiative could enhance Hong Kong's competitiveness as a regional gold trading and settlement centre, complementing broader efforts to develop the city's commodities market capabilities .
This study represents a strategic shift in Hong Kong's reserve management approach, potentially strengthening the city's gold market ecosystem by integrating Exchange Fund holdings with local market infrastructure. The initiative could enhance Hong Kong's competitiveness as a regional gold trading and settlement centre, complementing broader efforts to develop the city's commodities market capabilities .