Xi Drains Hong Kong’s Financial Reserves; Hong Kong Dollar Countdown Begins

On February 25, 2026, financial commentator Xiao Cui stated that tapping the Exchange Fund is a dangerous signal that Hong Kong may decouple from the U.S. dollar. / Yu Gang, The Dajiyuan

[People News] On February 25, financial influencer Xiao Cui said on her YouTube channel “Xiao Cui Current Affairs & Finance” that she had seen a “rather alarming” piece of news. Hong Kong Financial Secretary Paul Chan Mo-po proposed transferring HK$150 billion from the Exchange Fund to the Capital Works Reserve Fund to support the Northern Metropolis and other infrastructure projects. Xiao Cui described this as a dangerous signal, saying that the Exchange Fund is Hong Kong’s financial foundation. Diverting this money, she argued, is tantamount to declaring that the Hong Kong dollar has entered a countdown phase and that Hong Kong’s financial reserves are about to be drained by Xi Jinping—“the Hong Kong dollar is truly in countdown mode.”

According to Hong Kong media reports, Financial Secretary Paul Chan Mo-po proposed in the latest Budget that, under the Exchange Fund Ordinance and without affecting the fund’s role in maintaining Hong Kong’s monetary and financial stability, HK$150 billion be transferred from the Exchange Fund over the next two fiscal years—HK$75 billion each year—to the Capital Works Reserve Fund to support the Northern Metropolis and other infrastructure projects.

Xiao Cui pointed out in her program that the Hong Kong dollar is pegged to the U.S. dollar. To maintain this peg, a financial buffer must be preserved, and that buffer is the Exchange Fund—the last line of defense for Hong Kong’s linked exchange rate system. She emphasized that this defense has not been touched since 1984. “This money is not supposed to be touched; it’s the reserve at the very bottom of the trunk,” she said. Yet now, for an infrastructure project, Hong Kong’s finance chief intends to withdraw HK$150 billion from the Exchange Fund. She claimed that these infrastructure projects are all contracted out to mainland companies, “basically sending money to the emperor (Xi Jinping).” According to her, such projects are rife with corruption and mismanagement. She added that this move effectively “empties out Hong Kong’s entire fiscal foundation—this is truly extremely serious.”

Xiao Cui further stated that under the Exchange Fund Ordinance, Hong Kong must maintain assets equivalent to 105% of its monetary liabilities, meaning “the Exchange Fund is not something people would lightly touch.” Although the fund currently remains substantial—Hong Kong’s financial reserves are still strong and capable of defending the peg to the U.S. dollar—the purpose of maintaining such reserves is to ensure stability and instill confidence in the Hong Kong currency. Therefore, it is generally not to be used casually.

However, she argued that instead of using the Exchange Fund for emergencies, the government is now using it for infrastructure. “Everyone knows infrastructure means sending money to Beijing,” she said, calling it “the emperor (Xi Jinping) draining Hong Kong’s last remaining reserves.” She contended that the signal sent to the market is highly negative: it suggests that authorities no longer care much about the stability of the Hong Kong dollar, whether it can remain pegged to the U.S. dollar, or how the market perceives it—since they are now tapping into the untouchable core reserve.

She said that the priority now seems to be whether skyscrapers can be built; if funds run short, even the ancestral reserves will be spent. “It’s like digging up the ancestors’ graves,” she remarked, implying that if necessary, the Hong Kong dollar could simply be abandoned and replaced with the renminbi. “This is indeed a dangerous signal that Hong Kong may decouple from the U.S. dollar. There is no second interpretation.”

In conclusion, Xiao Cui said that Hong Kong no longer has autonomous governance. “The Hong Kong dollar is truly in countdown mode; the financial reserves are about to be drained.” She alleged that infrastructure projects are entirely contracted to Beijing, filled with corruption and benefit transfers, effectively channeling Hong Kong’s U.S. dollars to Beijing.

She also reminded Taiwanese viewers that seeing Hong Kong’s outcome—where even the Hong Kong dollar may be lost—should serve as a warning. “Are you still going to be pro-CCP?” she asked. △