Proceedings of the 2025 3rd International Academic Conference on Management Innovation and Economic Development (MIED 2025)

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Comparative Analysis of U.S. and China’s Monetary Policy Effects on the Stability of the Hong Kong Financial Market

Authors
Yijie Liu1, *
1Faculty of Business, Lingnan University, Hong Kong, China
*Corresponding author. Email: Yijie1202@outlook.com
Corresponding Author
Yijie Liu
Available Online 17 September 2025.
DOI
10.2991/978-94-6463-835-6_94How to use a DOI?
Keywords
financial market; Hong Kong; monetary policy; U.S.; China
Abstract

This study investigates the integrated effects of U.S. and Chinese equity markets, monetary policies, and exchange rate dynamics on Hong Kong’s financial stability using a tripartite VAR model (2015–2025) and Granger causality test. Findings indicate U.S. equity volatility and USD-CNY fluctuations strongly Granger-cause Hang Seng Index instability, while China’s equity market and monetary policy display secondary yet notable causal effects. U.S. monetary policy generates spillover effects via equity and currency channels, indirectly pressuring China’s yields and amplifying systemic risks. Under the tone of globalization, Hong Kong’s dual vulnerability—as a dollar liquidity conduit and mainland financial gateway—necessitates macroprudential buffers against cross-border volatility and enhanced integration with the mainland market to balance U.S.-China monetary divergence.

Copyright
© 2025 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the 2025 3rd International Academic Conference on Management Innovation and Economic Development (MIED 2025)
Series
Advances in Economics, Business and Management Research
Publication Date
17 September 2025
ISBN
978-94-6463-835-6
ISSN
2352-5428
DOI
10.2991/978-94-6463-835-6_94How to use a DOI?
Copyright
© 2025 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Yijie Liu
PY  - 2025
DA  - 2025/09/17
TI  - Comparative Analysis of U.S. and China’s Monetary Policy Effects on the Stability of the Hong Kong Financial Market
BT  - Proceedings of the 2025 3rd International Academic Conference on Management Innovation and Economic Development (MIED 2025)
PB  - Atlantis Press
SP  - 887
EP  - 895
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-835-6_94
DO  - 10.2991/978-94-6463-835-6_94
ID  - Liu2025
ER  -