Following is the transcript of a media session given by the Chief Executive, Mr Tung Chee Hwa, after officiating at the Council Inauguration and Honorary Degree Congregation of the Open University of Hong Kong this (Thursday) morning:

Chief Executive: I started off by congratulating my colleagues and friends how well this open learning university is progressing and that how much contribution this university will make to Hong Kong's well-being in the future. I also want to take this opportunity to emphasise one more time our determination to maintain the linked exchange rate and that we have the absolute total ability to maintain the exchange rate and that our economic fundamentals are really really very good and very sound and that the linked exchange rate policy will not, I repeat, will not change.

Reporter: How long will higher interest rate last.. ... comments about...exchange rate?

Chief Executive: I think there has been some degree of interest rate volatility and I notice that last night and this morning, the one-to-three-month interest rate went up. But I would say that we are determined to maintain our current policy on the linked exchange rate. I believe that we will succeed and very confident we will succeed in defending the link because our fundamentals are good and as soon as this has happened, interest rate will start to get back.

Reporter: What happen if the interest rate keeps going up?

Chief Executive: You are asking a hypothetical question. I think we'll be alright. Our fundamentals are good, don't forget that.