Hong Kong Dollar (HKD) Profile
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$ or HK$
1. HKD is pegged with U.S.dollar at 1 USD = 7.75–7.85 HKD
2. HKD is pegged by Macanese patacas (MOP) at 1 HKD=1.03 MOP.
Hong Kong dollar users
The Hong Kong dollar is the currency of Hong Kong. It is also widely accepted in Macau.
Macanese pataca (ISO 4217 Currency Code: MOP) is the legal tender of Macau but major in circulation currency is Hong Kong dollars which is generally accepted throughout Macau from casinos, restaurants to government payments. In some small stores and restaurants, the Hong Kong dollar will be accepted but change will be pataca. Conversely, the Macanese patca is not accepted in Hong Kong and very few banks in Hong Kong would exchange patca to Hong Kong dollar. Currently Macanese pataca is pegged to the Hong Kong dollar at a rate of 1 HKD=1.03 MOP. Meanwhile the Hong Kong dollar is pegged to with the U.S. dollar at a linked exchange rate of 1 USD =7.75 -7.85 HKD (narrow band). Hence the Macanese pataca (MOP) is pegged with the U.S. dollar at a narrow band rate of around 1 USD =8 MOP.
Hong Kong locates on China’s south coast. It borders with Shenzhen city of Guangdong province and is enclosed by the South China Sea and the Pearl River Delta. Macau and Hong Kong are at west and east opposite sides of the Pearl River Delta. They are two special administrative regions of the People’s Republic of China. Hong Kong was a colony of the British Empire since 1842 until 1997 (except 1941 to 1945).
Hong Kong dollar is one of the most traded currencies in foreign exchange market after the currencies of U.S. dollar (USD), euro (EUR), Japanese yen (JPY), British pound sterling (GBP), Swiss franc (CHF), Canadian dollar (CAD). Some currencies like Australian dollar (AUD). New Zealand dollar (NAD), Swedish krona (SEK), South Korean won (KRW), Singapore dollar (SGD), Norwegian krone (NOK), Mexican peso (MXN), Indian rupee (INR), South African rand (ZAR) are also at high traded ranks in foreign exchange market.
Hong Kong dollar history
The currently circulating Hong Kong dollar was introduced in 1935 which abandoned the silver standard. Previously since 1895, the three currencies of Mexican peso, British pound sterling and Hong Kong silver dollars were set as legal currencies in Hong Kong and the government announced forbidding other currencies being circulated. However, people were still accustomed to using currencies of Spanish dollars, Chinese yuan and Japanese yen and these currencies were continued to be used in the two years after the Hong Kong dollar introduction. On August 1, 1937, the Hong Kong dollar became legal tender, all other currencies were ceased to be used since then.
The Hong Kong dollar was initially introduced pegging to British pound sterling at 1 GBP =15.36 to16.45 HKD and at 1 GBP =16 HKD (1 HKD = 1 shilling 3 pence). The British pound sterling was decimalized in 1971 with 1 pound= 100 pence. Prior to decimalization, the pound was divided into 20 shillings and each into 12 pence.
The Hong Kong dollar was shifted to pegging the U.S. dollar since June 1972, initially at 1 USD =5.65 HKD and then to 1 USD = 5.085 HKD in February 1973. Hong Kong dollar started to float since November 1974 until it was fixed at a linked pegging rate at 1 USD =7.8 HKD in October 1983. This narrow band pegging rate remained to present.
Hong Kong dollar coins and banknotes
The Hong Kong dollar is subdivided into 100 cents (仙, sin) or 10 hou (毫). However since October 1, 1995, subunit of cent (sin, 仙) is no longer legal tender and the 1 sin banknotes were ceased to be circulation.
Currently in circulation coins are in denominations of 1, 2, 5 hou, 1, 2, 5, 10 dollars and banknotes are in denominations of 10, 20, 50, 100, 150, 500, 1000 dollars.