Hong Kong’s January 2025 Monetary Statistics Show Positive Trends

In January 2025, the Hong Kong Monetary Authority (HKMA) reported a notable increase in total deposits with authorized institutions, which rose by 1.4%. This growth reflects an uptick in both Hong Kong dollar deposits and foreign currency deposits, which increased by 1.3% and 1.5% respectively, according to the HKMA. A significant surge was observed in renminbi deposits, which climbed by 6.5% to reach RMB986.8 billion by the end of January, primarily due to corporate fund flows.

Deposit and Loan Dynamics

The total remittance of renminbi for cross-border trade settlement was RMB1,377.4 billion in January, slightly down from RMB1,401.6 billion in December. The HKMA emphasizes that deposit changes can be influenced by various factors such as interest rate movements and fundraising activities, advising that longer-term trends provide more accurate insights than monthly fluctuations.

Conversely, total loans and advances saw a slight decrease of 0.2% in January. Loans for use in Hong Kong, including trade finance, dropped by 0.5%, while loans for use outside Hong Kong experienced a 0.6% increase. The Hong Kong dollar loan-to-deposit ratio also decreased to 75.7% from 77.1% at the end of December, attributed to an increase in Hong Kong dollar deposits alongside a decrease in loans.

Monetary Aggregates

Both the Hong Kong dollar M2 and M3 monetary aggregates rose by 1.5% in January and by 4.5% compared to the previous year. Meanwhile, the seasonally adjusted Hong Kong dollar M1 saw a decrease of 3.0% in January but increased by 1.8% year-on-year, partly reflecting investment-related activities. Total M2 and M3 also experienced a 1.6% increase in January and a robust 9.6% growth compared to the same period last year.

The HKMA cautions that monthly monetary statistics can be volatile due to transient factors such as seasonal and IPO-related funding demands, as well as business and investment activities. Therefore, careful interpretation of these statistics is recommended.

For comprehensive details, refer to the official release by the Hong Kong Monetary Authority.

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