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Last Friday, the Signing Ceremony of the Convention on the Establishment of the International Organization for Mediation was held in Hong Kong. Representatives from 33 countries signed the convention, becoming founding member states of the International Organization for Mediation (IOMed); senior representatives from over 50 countries and nearly 20 international organisations were also in attendance. The IOMed serves as an important mechanism for peacefully resolving international disputes through mediation, in line with the principles of the United Nations Charter. With the support from our country and the consensus of the signatory countries, its headquarters will be located in Hong Kong. This is the first intergovernmental international organisation to establish a headquarters in the city. The Hong Kong Special Administrative Region Government will accelerate the relevant preparatory work, aiming for the headquarters to start operations as early as the end of this year.

Global markets have continued to experience volatility, particularly following the recent downgrade of the US sovereign credit rating, which has led to a sharp rise in Treasury yields. This situation has renewed focus on the stability of US dollar-denominated assets and the necessity for risk diversification. In the face of this uncertain external environment, our country has remained firmly committed to high-level opening up, providing international investors with a predictable and stable investment environment. Recently, several major foreign financial institutions which visited the Mainland expressed confidence in our country's development prospects, and pledged to deepen their engagement with the Mainland market and increase their investments in China.

Earlier this month, the Hong Kong dollar exchange rate remained persistently strong, trading close to 7.75 against the US dollar, and triggered the strong-side Convertibility Undertaking four times. In response, the Hong Kong Monetary Authority (HKMA) repeatedly bought US dollars, injecting a total of about HK$129 billion into the market. The inflow of funds into the Hong Kong dollar bolstered market liquidity, leading to a decline in local interbank interest rates. Notably, the one-month Hong Kong Interbank Offered Rate (HIBOR), which is closely related to mortgage rates, dropped from 4% to around 1.3% recently. However, capital flows and interest rate trends are influenced by multiple internal and external factors, and uncertainties remain. The Government and regulatory authorities will continue to closely monitor market developments to safeguard financial stability.