Deposits held with Hong Kong banks increased in July, while renminbi deposits and cross-border trade settlements recorded stronger growth, according to data released by the Hong Kong Monetary Authority (HKMA).
Total deposits with authorized institutions rose 0.9% in July 2026, with Hong Kong dollar and foreign-currency deposits both increasing at the same rate.
In the first seven months of the year, total deposits increased 5.8%, while Hong Kong dollar deposits grew 6.2%, the HKMA said.
Renminbi deposits in Hong Kong rose 2.9% during July to RMB1.13 trillion ($158 billion), reinforcing the city’s position as a major offshore centre for the Chinese currency.
Renminbi remittances used for cross-border trade settlement increased to RMB1.38 trillion in July from RMB1.28 trillion in June. That represents a month-on-month increase of about 8.3%.
The rise in renminbi deposits and settlement activity points to continued use of Hong Kong’s banking system for transactions involving mainland China. However, the HKMA cautioned against drawing broad conclusions from changes recorded in a single month.
Deposit levels can be influenced by interest-rate movements, fundraising transactions and other business and investment-related activities, the authority said.
Growth in lending was more subdued. Total loans and advances increased 0.2% in July, although they were 6.6% higher in the year to the end of the month.
Loans for use in Hong Kong, including trade finance, declined 0.3%. Loans used outside the city increased 1.7%, indicating that external lending activity offset a contraction in domestic credit.
The Hong Kong dollar loan-to-deposit ratio fell to 70.7% at the end of July from 71.5% in June. The decline occurred as Hong Kong dollar deposits increased and loans denominated in the currency decreased.
A lower ratio indicates that banks are lending a smaller proportion of their deposit base, giving the sector more liquidity but potentially pointing to softer domestic credit demand.
Hong Kong dollar M2, a broad measure of money supply that includes cash and various deposits, increased 1% in July and 5.6% from a year earlier. Hong Kong dollar M3 also rose 1% during the month and 5.5% year over year.
Seasonally adjusted Hong Kong dollar M1, which covers currency in circulation and demand deposits, declined 0.5% in July and 0.6% from a year earlier.
The HKMA said the movement partly reflected investment-related activities.
Total M2 and M3, including foreign-currency components, both increased 1.1% in July and 10.2% from the same period a year earlier.
The figures suggest that liquidity within Hong Kong’s financial system continued to expand faster than lending in July.
The stronger growth in renminbi deposits and cross-border settlements also highlights the role of the city’s banks in facilitating offshore renminbi activity.
The HKMA said monthly monetary figures are subject to volatility arising from seasonal funding demand, fundraising exercises, and business and investment activity, making longer-term trends more useful than individual monthly movements.
