IN THE run-up to the handover the desire of Government representatives and the monetary authority to defend the value of the Hong Kong dollar and its foreign exchange link to the greenback is understandable. Whether it should be done unprompted in public forums and in reaction to foreign newspaper articles speculating about the currency's future - as the chief executive of the monetary authority, Joseph Yam Chi-kwong, did last week - must be doubtful. In opening remarks to his otherwise informative address to the British Chamber of Commerce on the monetary relationship between China and Hong Kong after 1997, he singled out a newspaper article for attack. He noted that about six weeks before, an article appeared in a London newspaper headlined: Currency speculations aim to force an end to pegging arrangement with US dollar - George Soros [currency speculator] challenges Chinese over Hong Kong dollar. He added: 'Very sensational stuff indeed, but Soros-related sources quickly denied this, confidence in our stable currency was unaffected, the exchange rate hardly moved.' Mr Yam said he brought the article to his audience's attention not because he was 'worried by the possibility of speculative attacks on our currency', but because he was concerned by the many factual errors in the article. The real question is whether Mr Yam and others should draw attention to such articles when it runs the risk of merely highlighting the situation even more. If the Chairman of the Federal Reserve Board, Alan Greenspan, for example, stood in a public forum and specifically singled out a media article for criticism because it speculated about the future of the US currency, alarm bells would ring. To hear Mr Yam's comments was exceptional. Coming less than three weeks after Financial Secretary Donald Tsang Yam-kuen had warned off Mr Soros, it is doubly exceptional. Speaking in New Zealand, Mr Tsang said Hong Kong officials contacted Mr Soros and his Quantum fund managers in August to convince them speculation in the dollar would be worthless. Now, the territory's de facto central banker and custodian of Hong Kong dollar stability against its US counterpart has criticised the same article that prompted questions to Mr Tsang. It is understandable that in the run-up to 1997 authorities would want to maintain confidence in the so-called 'peg' to the US dollar. But bolstering the dollar peg by word is one thing, responding to an article on the issue is quite another. The danger is that it is just as likely to have the opposite effect to that desired by the authorities, indicating perhaps to some speculators that there is concern at Government level about the potential vulnerability of the currency. Ian Perkin is assistant director and chief economist with the Hong Kong General Chamber of Commerce. The views expressed are his own and may or may not reflect Chamber policy.