Analysts Suggest US Lawmaker's Call to Review Hong Kong's Fed Funding Access Would Have Limited Impact
Analysts indicate that a request from a US lawmaker for a review of Hong Kong's access to a Federal Reserve facility offering short-term US dollar funding would not significantly affect the city because it is not a consistent source of financing.
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According to the South China Morning Post, analysts have stated that a call from a US lawmaker for a review of Hong Kong's access to a Federal Reserve facility that supplies short-term US dollar funding would have a limited effect on the city, given that this facility is not a regular source of financing. These analysts also noted that any potential restrictions could instead undermine the global dominance of the US dollar. John Moolenaar, who serves as the chairman of the House China Committee, has communicated with US Federal Reserve chairman Kevin Warsh, requesting a review of the Hong Kong Monetary Authority's (HKMA) access to the Foreign and International Monetary Authorities (FIMA) repo facility. This FIMA repo facility is what provides short-term US dollar liquidity to foreign central banks, as stated in a release from the committee on Tuesday.
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