Fears over Exchange Fund discipline overblown: Hong Kong’s dollar peg architect

AdvertisementHong Kong economyHong KongHong Kong EconomyExclusive | Fears over Exchange Fund discipline overblown: Hong Kong’s dollar peg architectJohn Greenwood says drawing HK$150 billion from the fund is justified, calling the move a legitimate, long‑term investment3-MIN READ3-MIN ListenConnor MycroftPublished: 8:00am, 9 Mar 2026Updated: 8:10am, 9 Mar 2026Hong Kong has adequate safeguards to prevent any misuse of the Exchange Fund, according to the economist known as the “father of the city’s dollar peg”, who called concerns over the government’s decision to draw from the de facto sovereign wealth fund “a little overblown”.John Greenwood said the government’s plan to transfer HK$150 billion (US$19.1 billion) from the fund – which plays an essential role in defending the Hong Kong dollar’s peg to the US dollar – would have no effect on the monetary system.He added that it was also “legitimate” for the government to justify the transfer as a reallocation of money from financial investments to infrastructure projects that would eventually generate economic returns.Advertisement“The [Hong Kong] government has always been very prudent, careful, conservative. So I’d be really surprised if this was a break with that tradition,” Greenwood said in an interview with the South China Morning Post.“It just seems to me that … this does not threaten the monetary system in any way.”AdvertisementGreenwood is credited as the driving force behind the Hong Kong dollar peg, after an article he wrote in 1983 formed the basis for the government’s policy to link the local currency to the US dollar.AdvertisementSelect VoiceSelect Speed0.8x0.9x1.0x1.1x1.2x1.5x1.75x00:0000:001.00x