Why does the Queen of England’s face appear on Hong Kong dollars?

According to research, Hong Kong was the first place to call currency "round". Originally, when Hong Kong became a British colony, it adopted British currency. However, because the trade with mainland China at that time was mainly in silver, silver coins from all over the world, including those from Mexico and mainland China, were freely circulated in Hong Kong. Later, in order to more effectively regulate the local currency, the government adopted the silver dollar as the basic currency unit, and the word silver dollar also changed from the original adjective to a quantifier. Hong Kong issued official currency for the first time in 1863, and a mint was established in Hong Kong in 1866. At that time, the one-dollar silver coins produced in Hong Kong would be printed with the words "Hong Kong One Yuan". The name of this currency was also transferred from Hong Kong to mainland China, Japan and South Korea, and became the unit name of the currency in various places. Later, the mint closed in 1868, and Hong Kong switched to other silver dollars as legal tender.

In 1935, rising silver prices in the United States and other places caused silver outflows from China and Hong Kong. The Hong Kong government passed the Currency Ordinance on November 9, 1935, announcing the use of the "Hong Kong dollar" as the currency unit of Hong Kong, and set the exchange rate between the Hong Kong dollar and the British pound at 16 Hong Kong dollars to 1 British pound. (China announced on November 4, five days before Hong Kong adopted the Hong Kong dollar as its currency, that it would abandon the silver standard and switch to legal currency.) On August 1, 1937, the circulation of various silver dollars was terminated, and the Hong Kong dollar was officially adopted as the legal currency. currency. When Japan occupied Hong Kong during World War II, it forcibly replaced the Hong Kong dollar with Japanese military notes. It was only after the war that the Hong Kong dollar regained its legal status.

The Hong Kong dollar was initially pegged to the British pound. However, Britain's economic strength weakened after the war and it even depreciated sharply, which affected Hong Kong's economy. The Hong Kong government then pegged the Hong Kong dollar to the US dollar after the pound became free-floating in June 1972. The initial exchange rate was HK$5.65 to US$1. In February 1973, it was changed to 5.085 Hong Kong dollars to 1 US dollar. From November 1974, it was changed to free floating. Until 1983, the crisis of confidence caused by the future of Hong Kong caused the exchange rate of the Hong Kong dollar to drop sharply. In September of the same year, it once fell to 9.6 Hong Kong dollars per US dollar. Starting from October 17 of the same year, the then Financial Secretary Peng Lizhi announced that the exchange rate of the Hong Kong dollar would be pegged to the U.S. dollar at 7.80 Hong Kong dollars per U.S. dollar, which has been maintained to this day.

Banknotes

Hong Kong’s first banknotes were issued by the Credit Agricole Bank of East Asia, which was established in Hong Kong in 1845. Before the government passed currency regulations in 1935, many banks issued banknotes, but these banknotes were mainly used for commercial transactions. The government only accepts banknotes from some chartered banks as legal tender. After 1935, the government authorized HSBC, Lee Bank (later acquired by HSBC) and Credit Agricole Bank of India (later renamed Standard Chartered Bank) to issue Hong Kong dollar banknotes above five dollars. Hong Kong dollar banknotes with denominations of one dollar and below are issued by the Hong Kong government. After the Hong Kong government issued five-dollar coins in 1975, the issuance of five-dollar notes stopped. In the 1990s, the government issued ten-dollar coins, and banks later stopped issuing ten-dollar notes. Later, the Bank of China also became one of the note-issuing banks in Hong Kong. In 2002, the government again issued ten-dollar notes through the Monetary Authority.

The government issued one-cent banknotes before 1995 for the purpose of facilitating redemption and being used to pay for government service inflation. These notes were no longer accepted as legal tender after October 1, 1995.

At present, there are three note-issuing banks in Hong Kong, namely Bank of China, HSBC and Standard Chartered Bank.

Coins

Before the handover of Hong Kong’s sovereignty in 1997, the Emperor’s portrait was cast on the coins in circulation, and they once became objects of collection. Since 1993, the government has gradually withdrawn the old coins and replaced them with new coins with the bauhinia, Hong Kong's city flower, on the reverse. However, the Queen's Head coin remains legal tender and circulates at the same time as the new coin.

The latest styles of Hong Kong dollar coins and banknotes

Face value ($) Material shape

One cent (0.10) brass alloy round

Two millimeters (0.20) Brass alloy wavy edge

Five millimeters (0.50) Brass alloy round

One yuan (1.00) White nickel alloy round

Two yuan (2.00) white nickel alloy with wavy edge

Five yuan (5.00) white nickel alloy round shape with Chinese characters "Hong Kong five yuan" engraved on the edge

Ten yuan ( 10.00) White nickel alloy outer ring,

Brass alloy center circle

Banknote

Face value ($) Color reverse landmark pattern