Financial Secretary Antony Leung today welcomed Moody's affirmation that Hong Kong's strong financial position continues to support its A3 foreign currency rating with a positive outlook and Aa3 domestic currency issuer rating with a stable outlook.

The ratings agency recognised Hong Kong's credit strengths, including:

* its excellent financial-market infrastructure;

* lack of government debt;

* substantial fiscal reserves; and

* the building up of a large net international investment position.

Moody's also acknowledged that Hong Kong will rely on its solid macroeconomic foundation in battling the negative effects of severe acute respiratory syndrome and other problems.

The Government reiterated that the one-off "relief and economic revival" package on SARS should not affect Hong Kong's medium-term fiscal position, nor the strategy for addressing the budget deficit problem and achieving fiscal targets by 2006-07.

Mr Leung said the Government is fully committed to the linked exchange rate system which is the linchpin of Hong Kong's monetary and financial stability and an important factor in Hong Kong's economic success in the past two decades.