Hong Kong Dollar Case Study
1.0 Introduction
The liberalization of foreign capital controls and taking on of floating exchange rate regime in South Asian countries have enlarged the scope of learning the connection between exchange rates and stock prices. Liberalization of foreign capital controls has released the possibility of international investment and the taking on of floating exchange rate regime has improved the volatility of foreign exchange market. Thus noticing the relationship between stock prices and exchange rates has become vital for the academicians, practitioners and policy makers.
After the East Asian crisis 1997, the subject of whether exchange rates and stock prices are related or not have received significant courtesy. For the duration of the crisis
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The Hong Kong dollar was made up of 100 cents and if often presented with the symbol $ or HK$. There is three Chinese note-issuing banks are authorized to issue Hong Kong dollars, which is subject to conditions laid out by the Hong Kong government.
Banknotes then run through a government exchange fund which holds the U.S. dollars in reserves and records all transaction in the general accounts of two currencies. The Hong Kong dollar was first seen as a distinct currency in 1863. Before then, various foreign currencies had been used, and continued to be used even after its inception. The HK dollar was outlawed by the Japanese puppet government in 1943 and reinstated in 1945 after the war. Hong Kong is now in sole control of the printing and administration of its currency. (Wikipedia)
e) Taiwan Dollar (TWD)
The currency abbreviation for the Taiwan dollar (TWD) is the currency for the Republic of China within Taiwan, Pescadores, Kinmnet and Matsu. The Taiwan dollar is made up of 10 jiao, and 100 fen, and is often presented with the symbol
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Overall, this study focuses on questions whether if there is correlation between exchange rate (United Stated Dollar, Singapore Dollar, Korean won, Hong Kong Dollar, and Taiwan Dollar) with Malaysia stock prices. It is important to know the correlation between exchange rate (United Stated Dollar, Singapore Dollar, Korean Won, Hong Kong Dollar, and Taiwan Dollar) with Malaysia stock prices because it may affect monetary and fiscal policy decision and to predict path of the exchange rate and help to predict a crisis. Thus, it is vital to study the link exchange rate with stock
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