The Hong Kong dollar regained a little ground against the US dollar on Thursday, helped by a rebound in the stock market. The local currency firmed to 7.7512, recovering from a 10-week low of 7.7522 against the US dollar in the previous session. Hong Kong's Hang Seng Index was up 1.92 percent on Thursday, bouncing off a one-month closing low in the previous session, tracking gains on the Shanghai bourse.
Some dealers said volatility in equity markets recently had made investors more cautious. One dealer expected the spot rate to consolidate in a range of 7.7510 to 7.7520 in the near term. The Hong Kong dollar is pegged at 7.80 to the US dollar but can trade between 7.75 and 7.85.
Local interbank rates and Hong Kong dollar forwards were little changed and trapped in a narrow range. One-month Hibor was fixed at 0.07786 percent, unchanged from Wednesday. Three-month Hibor nudged higher to 0.22643 percent from Wednesday's 0.21786 percent.
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