The Hong Kong dollar held within a narrow range against the US dollar on Friday, while interbank rates were mostly steady and hovered at a similar level to the previous session. The local currency traded between 7.7501 and 7.7503, near the upper end of its tight band to the US dollar.
Hong Kong stocks rose 3 percent at the midday break on Friday, rebounding from three days of losses, tracking gains on Wall Street after data showed the US economy expanding at a faster than expected pace. The world's largest economy grew at an annualised rate of 3.5 percent in the third quarter, beating forecasts of a 3.3 percent rise.
Dealers said the USD/HKD spot rate was likely to stay in a narrow range of 7.7500 and 7.7505 in the near term, with eyes on the fund flows from the stock market. China's Minsheng Banking Corp and Las Vegas Sands have received approval from the Hong Kong stock exchange to go ahead with their IPOs in Hong Kong.
The Hong Kong dollar is pegged at 7.80 to the US dollar but can trade between 7.75 and 7.85. The HKMA is usually obliged to intervene when the local currency hits 7.75 or 7.85. In the interbank market, the overnight rate has remained at near zero because of abundant liquidity in the banking system. Three-month Hibor was fixed at 0.17919 percent, up slightly from Thursday's 0.17821 percent, but Thursday's level was a five-year low.
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