The official currency in the Chinese special economic zone and trading metropolis Hong Kong is the Hong Kong dollar. It is abbreviated to HK $ and the ISO code is HKD. In China, the currency is often referred to as the “port dollar.” A Hong Kong dollar is divided into 100 cents.
The Hong Kong dollar has been pegged to the US dollar since 1972. In Hong Kong, the central bank does not issue banknotes, Instead, three commercial banks are in charge of this task.The
HK $ is one of the most traded currencies in the world, except in Hong Kong it is still a frequently used currency in Macau.
History of currency of Hong Kong
The Hong Kong dollar was introduced in 1935, before the silver dollar was the common currency. The HK $ was pegged to the British pound for the first time as Hong Kong was a British crown colony at the time. One pound was equivalent to HK $ 16.
During the Japanese occupation in World War II until 1945, the Hong Kong dollar was initially pegged to the Japanese currency, the yen, then it was declared invalid and the yen remained the only official currency.
After the end of the war and the liberation, the city regained its status as a British crown colony and the Hong Kong dollar, pegged to the British pound, became the currency again.
In 1972 the peg to the pound sterling was broken and it was pegged to the US dollar instead. The exact exchange rate will be revised from time to time. It is currently in the range of HK $ 7.75 to HK $ 7.85 for one US dollar.
A special feature of Hong Kong is that the currency is not issued by a central bank as in almost all other countries, but by the three commercial banks HSBC, Bank of China and Standard Chartered.
Because they are pegged to the US dollar, they are only allowed to issue new Hong Kong dollars if they have deposited sufficient US dollars.
The notes of the currency are available in denominations of 10, 20, 50, 100, 500 and HK $ 1,000.
Up until 1975 there was still a note worth HK $ 5, this denomination is still available today as a coin.
The HK $ 1,000 note has existed since 1977.
Since the banks are free to decide on the design of the notes, they differ somewhat depending on which bank issued them. However, for the sake of clarity, the banks try to keep the layout similar.
The motifs of the notes have also changed over time. While the portrait of Queen Elizabeth II was very popular in earlier years, today many notes show the Hong Kong orchid tree, the city flower of the port city.
Exchange into Hong Kong currency
The Hong Kong dollar and other currencies can be imported and exported.
However, it is usually cheapest to withdraw money using a credit card from an ATM, one of the larger banks.