The Exchange Fund recorded an investment income of $212.7 billion in 2023, with an investment return of 5.2%, the Monetary Authority announced today.

Commenting on the fund's investment results, the authority's Chief Executive Eddie Yue said even though the investment environment in 2023 was extremely volatile and challenging, the fund managed to achieve a decent return overall.

He pointed out that the fund's investment income from bond holdings set a new record.

Total assets of the fund increased $9.8 billion from the end of 2022 to $4.0178 trillion at the end of 2023.

Fees payable to the fiscal reserves was $17.5 billion, while the fee for placement by government funds and statutory bodies totalled $16.5 billion in 2023.

Looking ahead, global financial markets will continue to face numerous challenges in 2024, Mr Yue said. He emphasised that markets expect that the interest rate hike cycle is almost over, but the time required for inflation to return to the target levels set by major central banks remains uncertain.

“Furthermore, the biggest unknown factor remains geopolitical risks. 2024 is also a key election year as many major elections are scheduled to be held. The outcome of these elections will further increase market uncertainties and pose challenges to the exchange fund.”

Apart from stressing that the authority will continue to adhere to the principle of capital preservation first while maintaining long-term growth, Mr Yue made it clear that it will persist with managing the fund with prudence and flexibility.


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