HK Exchange Fund's investment income down 46% in 2014

    The Hong Kong Monetary Authority (HKMA) said today the Exchange Fund recorded an investment income of HK$43.6 billion in 2014 with an investment return of 1.4%.
  Such income included gains on Hong Kong equities amounting to HK$6.5 billion, gains on other equities amounting to HK$33.7 billion, gains on bonds of HK$47.3 billion, an exchange loss of HK$52.7 billion, and gains on other investments amounting to HK$8.8 billion.
  On the outlook for the coming year, the Chief Executive of the HKMA, Norman Chan, said the investment environment in 2015 will be even more complex and difficult than 2014. There is considerable uncertainty arising from the timing and pace of the US interest rate normalisation, which is then complicated by the implementation of QQE by Japan and the launch of a full scale QE by the ECB. The recent sharp rise in the USD, big drop in oil prices and the market turbulence following the surprise move by the SNB to drop the one way peg of the Swiss Franc against Euro were just some of the more notable manifestations of the market reaction to a very abnormal global financial and macroeconomic environment.