Hong Kong’s monetary picture stays bleak

Total deposits in Hong Kong’s banking system inched forward by just 1% in August, said the Monetary Authority.

Reflecting this slowdown were Hong Kong’s dollar deposits that crawled upwards by only 1.5% while foreign-currency deposits improved by a scant 0.4%.

Renminbi deposits fell 1.9% to RMB552.3 billion. Total renminbi remittances for cross-border trade settlements amounted to RMB254.2 billion in August compared to RMB223.4 billion in July.

Total loans and advances fell 0.3%, with loans for use in Hong Kong down 0.1% and outside Hong Kong down 0.5%. As Hong Kong dollar loans increased at a slower rate than deposits, the Hong Kong dollar loan-to-deposit ratio plunged to 82.4% at the end of August.

Seasonally adjusted Hong Kong-dollar M1 grew just 0.6% in August and expanded 8.6% year on year. Unadjusted Hong Kong-dollar M3 increased 1.5% during the month and expanded 8.5% from a year earlier.