Hong Kong Monetary Authority ( HKMA) Chief Executive Joseph Yam on Monday tried to ease local investors' nerve after global stock markets fell sharply following the worsening credit crisis in the United States.
Speaking to reporters on the volatile stock market, Yam called on market participants to study the situation and manage risks as "the U.S. credit crisis has thus far caused no structural impact to Hong Kong's finance market."
Hong Kong stocks dived 1,152.50 points, or 5.18 percent, to close at 21,084.61 on Monday.
The U.S. Federal Reserve announced Sunday two initiatives to bolster market liquidity and promote orderly market functioning.
The New York Federal Reserve Bank has been authorized to create a lending facility to upgrade primary dealers' ability to provide financing to participants in securitization markets. The measure will be in place for six months and may be extended as conditions warrant.
The primary credit rate has also been cut from 3.5 percent to 3. 25 percent and the maximum maturity of primary credit loans raised to 90 days from 30.
Yam told reporters that the measures taken by the U.S. Federal Reserve will help stabilize the market and boost orderly market functioning.
While the crisis will not greatly hurt Hong Kong's finance market, Yam said nervous sentiment in global markets might result in volatile trading.
He urged market participants to ensure proper risk management and closely watch the market's latest development.
Source: Xinhua
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