Hong Kong and Japan in Money Pact
Hong Kong and Japan are connecting their financial systems for specific currency trades.
Japan and Hong Kong are linking their financial systems. The Japanese central bank announced the unique move in a media statement on its website. The arrangement will allow the two parties to immediately settle transactions involving assets denominated in their respective currencies.
Presently Japanese banks operating in Hong Kong acquire funds by exchanging Japanese yen for U.S. dollars, and then use the dollars to buy Hong Kong dollars. Under the new agreement Japanese banks will now be able to secure Hong Kong dollars without having to pay the cost of exchanging yen for the U.S. currency.
