The Hong Kong dollar remained near the bottom of its recent range on Thursday afternoon as players continued to buy US currency due to the wider differential in Hong Kong and US interest rates.
"People anticipate there will be less inflows of fund in the near term amid a lack of new IPOs and the sluggish stock market. So they prefer buying US dollar in arbitrage trades," one trader at a local bank said.
The local currency has come under pressure over the past week after the US Federal Reserve raised rates by 25 basis points and Hong Kong banks left rates unchanged.
The blue chip Hang Seng Index ended a scant 0.06 percent higher on Thursday, snapping a three-day losing streak, while the H-share index of Hong Kong-listed Chinese-registered firms edged up 0.29 percent.
The local currency weakened to 7.7998/99 from 7.7995 in early morning business. It was flat from the previous close but a shade higher than the HK $7.80 linked exchange rate to the US dollar.
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