London Daily

Focus on the big picture.
Thursday, Jul 10, 2025

Donald Trump unlikely to target Hong Kong dollar peg to US dollar, says former top diplomat

Kurt Tong, who served as US consul general in city, says move would only serve to undermine his nation’s currency. US president signed executive order ending Hong Kong’s special status but it made no mention of monetary delink

Hong Kong’s currency peg to the US dollar is unlikely to be a target of attack by US President Donald Trump, because it would not benefit the United States, according to a former American diplomat in the city.

Kurt Tong, the former US consul general who is now a partner at the business consultancy Asia Group, said delinking the currency would only undermine the status of the US dollar, and would be detrimental to American corporations, as it gained a lot of advantages from being used internationally.

He was speaking exclusively on Friday night, together with Secretary for Commerce and Economic Development Edward Yau Tang-wah, and Allan Zeman, the chairman of nightlife district developer Lan Kwai Fong Group, at the South China Morning Post’s webinar series, SCMP Conversations – Caught between the United States and China: Can Hong Kong’s economy thrive in uncertain times?

Tong said speculation over seeing the dollar peg removed had faded, and the White House was not interested in it happening.

“It’s practically very difficult and expensive … to actively undermine the confidence of another currency,” Tong said.

“The peg is a Hong Kong policy to stabilise its Hong Kong currency for international transactions. It would undermine confidence of the US dollar as the most secured currency for transactions.

“Why should the US take this much bigger step of trying to actively undermine the Hong Kong dollar or Hong Kong’s financial system?”

In his response to Beijing’s decision to impose the national security law on Hong Kong, Trump signed an executive order on July 14 revoking the city’s different and preferential treatments stipulated by the Hong Kong Policy Act of 1992.

At the time, the US president said Hong Kong would “now be treated the same as mainland China”, which meant there would be “no special privileges, no special economic treatment, and no export of sensitive technologies”.

The executive order did not mention limiting Hong Kong banks’ access to the US dollar payment system as a way of punishing China, which would undermine the currency peg system that has allowed the city to remain a global financial hub.

The Hong Kong dollar has been pegged to the US dollar since October 1983, when there was a crisis of confidence as the British and mainland Chinese governments negotiated the 1997 handover of the city.

Originally set at a rate of 7.8 per US dollar, the Hong Kong dollar has been allowed to trade between 7.75 and 7.85 per US dollar since 2005.

The currency peg is backed by the city’s foreign reserves of more than US$440 billion.

Any governments, including Hong Kong, can determine which currency to peg to and what exchange rate they want to fix at, but the US has the right to ban any lenders, or the Hong Kong Monetary Authority, the city’s de facto central bank, from trading the US currency.




Newsletter

Related Articles

0:00
0:00
Close
Severe Heatwave Claims 2,300 Lives Across Europe
NVIDIA Achieves Historic Milestone as First Company Valued at $4 Trillion
Declining Beer Consumption Signals Cultural Shift in Germany
Linda Yaccarino Steps Down as CEO of X After Two Years
US Imposes New Tariffs on Brazilian Exports Amid Political Tensions
Azerbaijan and Armenia are on the brink of a historic peace deal.
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Weinstein Victim’s Lawyer Says MeToo Movement Still Strong
U.S. Enacts Sweeping Tax and Spending Legislation Amid Trade Policy Shifts
Football Mourns as Diogo Jota and Brother André Silva Laid to Rest in Portugal
Labour Expected to Withdraw Support for Special Needs Funding Model
Leaked Audio Reveals Tory Aide Defending DEI Record
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
London Stock Exchange Faces Historic Low in Initial Public Offerings
A new online platform has emerged in the United Kingdom, specifically targeting Muslim men seeking virgin brides
Trump Celebrates Independence Day with B-2 Flyover and Signs Controversial Legislation
Boris Johnson Urges Conservatives to Ignore Farage
SNP Ordered to Update Single-Sex Space Guidance Within Days
Starmer Set to Reject Calls for Wealth Taxes
Stolen Century-Old Rolls-Royce Recovered After Hotel Theft
Macron Presses Starmer to Recognise Palestinian State
Labour Delayed Palestine Action Ban Over Riot Concerns
Swinney’s Tax Comments ‘Offensive to Scots’, Say Tories
High Street Retailers to Enforce Bans on Serial Shoplifters
Music Banned by Henry VIII to Be Performed After 500 Years
Steve Coogan Says Working Class Is Being ‘Ethnically Cleansed’
Home Office Admits Uncertainty Over Visa Overstayer Numbers
JD Vance Questions Mandelson Over Reform Party’s Rising Popularity
Macron to Receive Windsor Carriage Ride in Royal Gesture
Labour Accused of ‘Hammering’ Scots During First Year in Power
BBC Head of Music Stood Down Amid Bob Vylan Controversy
Corbyn Eyes Hard-Left Challenge to Starmer’s Leadership
London Tube Trains Suspended After Major Fire Erupts Nearby
Richard Kemp: I Felt Safer in Israel Under Attack Than in the UK
Cyclist Says Police Cited Human Rights Act for Riding No-Handed
China’s Central Bank Consults European Peers on Low-Rate Strategies
AI Raises Alarms Over Long-Term Job Security
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Musk Battles to Protect Tesla Amid Trump Policy Threats
Air France-KLM Acquires Majority Stake in Scandinavian Airlines
UK Educators Sound Alarm on Declining Child Literacy
Shein Fined €40 Million in France Over Misleading Discounts
Brazil’s Lula Visits Kirchner During Argentina House Arrest
Trump Scores Legislative Win as House Passes Tax Reform Bill
Keir Starmer Faces Criticism After Rocky First Year in Power
DJI Launches Heavy-Duty Coaxial Quadcopter with 80 kg Lift Capacity
U.S. Senate Approves Major Legislation Dubbed the 'Big Beautiful Bill'
Largest Healthcare Fraud Takedown in U.S. History Announced by DOJ
×