The government has been criticised this weekend by Martin Lee, head of the Democratic Party, for damaging credibility in Hong Kong's free market and status as a "world financial centre".
The government claimed it had not departed from its non-interventionist policy but was thwarting what looks like a highly technical "sustained and heavy" assault on the HK dollar with evidence of hedge funds attacking the currency to benefit from short positions in the Hang Seng futures markets. Financial Times: "Under this strategy, hedge funds sell the Hong Kong dollar, forcing up interest rates through the automatic adjustment mechanism of the territory's currency exchange board system. Higher interest rates depress the stock market, providing profits for short positions in which investors sell shares and futures contacts they do not own in anticipation of a fall in their value."
How often Hong Kong can do this remains to be seen.
I am reporting this item because I would still claim that Hong Kong has been surprisingly resilient. But this may be a sign that it is cracking.
Chris Burford