Pegged Exchange Rate Systems in Macau and Hong Kong

Scott, Robert H.

Volume 1, Number 2 / June , Pages 93-168

Multinational Finance Journal, 1997, vol. 1, no. 2, pp. 153-168

Robert Haney Scott , University of Macau, Macau Corresponding Author

Abstract:
Macau pegs its currency, the pataca, to the Hong Kong dollar, which in turn is pegged to the U.S. dollar. This type of pegging order is unique in the annals of international financial arrangements. This article analyzes the structure of the pegged exchange rate systems in Macau and Hong Kong and discusses the financial and economic implications of these systems for the two territories

Keywords : currency board system; currency substitution; pegged exchange rates; seigniorage
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