Exchange fund notches HK$18.7b in losses in third quarter from forex, stock holdings
Reserves hit by drop in value of euro, yen and British pound holdings

The Exchange Fund, whose reserves are used to defend the Hong Kong dollar, lost HK$18.7 billion in the third quarter as a result of valuation losses on its foreign exchange holdings and Hong Kong stocks, Hong Kong Monetary Authority chief executive Norman Chan Tak-lam said yesterday.

The value of the Exchange Fund's Hong Kong stock holdings fell HK$200 million, but bond investments gained HK$7.1 billion and holdings of overseas stocks gained HK$2.8 billion.
In the first nine months of the year, the Exchange Fund's gains stood at HK37.7 billion, down sharply from the HK$56.4 billion gain in the first half of the year.
The Exchange Fund paid HK$6.7 billion to the government in the third quarter, taking payments for the first nine months of the year to HK$20.6 billion.
Louis Tse Ming-kwong, director of VC Brokerage, said he was not optimistic about the Exchange Fund's performance outlook.
