The Hong Kong Monetary Authority reported modest monetary expansion in June 2026, with total deposits at authorized institutions climbing 0.1%, driven primarily by strength in Hong Kong dollar holdings. Released on 31 July, the monthly statistics reveal diverging trends across currency denominations, while lending activity accelerated at a faster pace than deposit growth during the period.
- Hong Kong Dollar Deposits: +0.9% in June; +5.3% in H1 2026
- Foreign Currency Deposits: -0.5% in June
- Renminbi Deposits: -3.6% in June to RMB1,093.5 billion
- Total Loans and Advances: +1.3% in June; +6.4% in H1 2026
- HKD Loan-to-Deposit Ratio: 71.5% (up from 71.0% in May)
- Renminbi Cross-Border Trade Settlement: RMB1,277.7 billion in June vs. RMB1,129.6 billion in May
Hong Kong dollar deposits expanded 5.3% in the first half of 2026, outpacing total deposit growth of 4.9%, signaling sustained demand for the local currency amid shifting capital flows. Conversely, renminbi deposits contracted 3.6% to RMB1,093.5 billion, though cross-border renminbi trade settlement activity surged to RMB1,277.7 billion in June from RMB1,129.6 billion the previous month, indicating continued momentum in offshore renminbi usage for commercial transactions.
Lending growth outpaced deposit accumulation during the period, with total loans advancing 1.3% in June and 6.4% year-to-date. Loans for use in Hong Kong, including trade finance, increased 1.4% in June, while overseas lending rose 1.0%. The HKD loan-to-deposit ratio climbed to 71.5% from 71.0% in May, reflecting faster growth in local currency lending relative to deposits. For the second quarter overall, loans to financial concerns and manufacturing sectors led the expansion.
Monetary aggregates showed modest growth, with Hong Kong dollar M2 and M3 both rising 0.8% in June and 2.6% year-over-year. The seasonally-adjusted Hong Kong dollar M1 declined 1.0% in the month and 3.0% annually, partly reflecting investment-related activities. The HKMA cautioned against over-interpreting single-month fluctuations, noting that deposits and monetary indicators remain subject to transient factors including seasonal funding demands and market activity.
