During Covid, the tourism industry of many countries suffered due to lockdowns and travel restrictions. However, with things returning to normalcy, people are engaging in revenge tourism. The governments are also taking steps to promote tourism. Take Hong Kong, for example. It is giving away over half a million free aeroplane tickets to revive its tourism industry from March to September 2023. As tourists, one must carry the local currency of that place. The local currency of Hong Kong is the Hong Kong Dollar (HKD or HK$). Read to find out about the Hong Kong Dollar, its history, and how to convert INR to HKD.

History Of The Hong Kong Dollar

The Hong Kong Dollar has been in use since 1863. Although it was a British Colony from 1841 to 1941, the country had its own currency. Under British rule, they tried to incorporate the pound and shillings, but residents of Hong Kong were hesitant to use them. Hence the Hong Kong Dollar was created and has been in use since then.

The Hong Kong Dollar was pegged to the US Dollar gold standard and faced a depreciation during the silver crisis in 1873. However, it remained pegged to the US Dollar. Post the decline, the Mexican and Spanish coins were still in circulation. To reduce this, the British government traded in Dollars which were used legally in Hong Kong until World War II.

During the war, the Japanese invaded Hong Kong and introduced their official currency Yen to the country. It was in use until the end of the war. Post the second world war, the country used the Hong Kong Dollar again and pegged it to the US Dollar in 1983. Even today, the HKD is pegged to the Dollar at 1 USD equals 7.8 HKD and changes in value occasionally.

The Hong Kong Dollar is issued by Hong Kong Monetary Authority (HKMA), the country's central bank. However, it has licensed this work to three commercial banks that issue HKDs on behalf of the HKMA. The HKD bank notes come in denominations of 10 HKD, 20 HKD, 50 HKD, 100 HKD, 500 HKD, and 1,000 HKD notes. The coins include 10, 20, and 50 cents and 1 HKD, 2 HKD, 5 HKD, and 10 HKD.

Factors Influencing Hong Kong Dollars Rate

The major factors influencing the HKD are as follows

Interest rates: The value of HKD is affected by interest rates. If interest rates decline, the HKD weakens against the US Dollar and strengthens when the interest rates rise. The HKMA used interest rates to maintain the USD to HKD rate within the limit set by HKMA.

Inflow or outflow of HKD: Hong Kong is a global financial centre and attracts a lot of foreign investment. If external funds increase, the HKD value appreciates. On the other hand, if external funds decrease, the HKD value depreciates.

Why Is The Hong Kong Dollar So Stable?

The Hong Kong Dollar is the world's most stable and trustworthy currency. This is because it is one of the few currencies with a constitutional basis. The Article 111 of its constitution states that the issue of the HKD is to be backed by a 100% reserve fund. Today, Hong Kong has the world's highest foreign exchange reserve fund, which can be used to defend its currency in the global market.

Why Does Hong Kong Peg Its Currency?

Hong Kong pegged its currency to the US Dollar in 1983. Hence its value moves only within a certain range, which is HK$7.75 to HK$7.85 per US dollar. The primary reason for this is to maintain financial stability. Hong Kong first introduced the peg to reestablish investor confidence which was hit due to an economic crisis in 1983. However, the country continued to peg its currency to maintain financial stability.

In an open economy like Hong Kong, financial stability is necessary to facilitate trade and logistics. It is because of this financial stability that Hong Kong became a global financial centre attracting investor money from all over the world.

How To Convert INR To HKD?

You can convert INR to HKD manually or use an online currency converter tool.

To convert INR to HKD manually, you must divide the Indian currency by the HKD INR exchange rate. For example, if the current exchange rate between HKD and INR is Rs 10.5. To convert INR 50,000, you must divide it by Rs 10.5 to get the equivalent value in Hong Kong Dollars. So, the equivalent value of Rs 50,000 is HKD$ 4,750.

To convert INR to HKD using an online currency converter tool such as Jupiter, you must select HKD from the drop-down and enter the value in Indian Rupees. The tool will automatically show you the value in Hong Kong Dollars at the latest exchange rate.

Using an online tool is easier than calculating manually, as the exchange rate changes every second. Moreover, the calculator estimates the value within seconds, saving you time.

Indian Rupees (INR) To Hong Kong Dollars (HKD) Exchange Rate History

Frequently Asked Questions

How much money in cash can I carry to Hong Kong?

The maximum amount of cash you can carry in and out of Hong Kong is HKD$ 120,000. If you carry more than this amount, you must declare it to the customs and excise department.

Why is it called the Hong Kong dollar?

When Hong Kong was a colony under the British rule, the Chinese people wanted to have their own currency and didn't want to use a currency which looked like Mexican or Spanish coins. Hence in 1863, Hong Kong introduced its own currency and named it the Hong Kong Dollar which was pegged to the US Dollars.

Can you use Indian Rupees in Hong Kong?

No, you cannot use Indian Rupees in Hong Kong. The Hong Kong Dollar is the most widely accepted currency in Hong Kong. Apart from this, you can also use the renminbi (RMB), the Chinese currency.

Can you use US dollars in Hong Kong?

Although the Hong Kong Dollar are the most widely accepted currency in Hong Kong, some hotels and restaurants accept US Dollars, Euros, Japanese Yen, and Chinese Renminbi. However, it is best to carry Hong Kong Dollars in cash and card to shop at local stores.

Which country uses Hong Kong Dollar?

Apart from Hong Kong, the HKD is accepted in the neighbouring country Macau. The Macanese pataca is also pegged to the Hong Kong Dollar, and hence these two currencies are accepted in Hong Kong and Macau.