Receive $80 Grab vouchers valid for use on all Grab services except GrabHitch and GrabShuttle when you subscribe to BT All-Digital at only $0.99*/month.
Find out more at btsub.sg/promo
[HONG KONG] Hong Kong's currency system can't realistically serve as a conduit between China and the rest of the world, according to a former chief executive of the Hong Kong Monetary Authority.
The city's status as a global financial centre makes its economy especially vulnerable to volatile fund flows - a dilemma that will only deepen as China relaxes its capital controls, Joseph Yam wrote in a blog post Thursday.
It may be wise to let local stocks be priced and traded in the yuan as well, he suggested. Hong Kong's dollar is pegged to the greenback.
Mr Yam - known for defending the peg during the Asian financial crisis - is not one to shy from controversy.
The local dollar spiked in 2012 after he called for a review of the peg. Just last month, Mr Yam, now on the Hong Kong government's executive council, advocated a more proactive fiscal policy, a stance that was seen as a subtle dig at the last administration.
The peg means Hong Kong has to track US monetary policy. Massive inflows since the global financial crisis have contributed to inflation and asset rallies, making the city the world's least affordable housing market.