The Hong Kong dollar strengthened and discounts on forwards deepened on Friday in choppy trade amid fresh talk of 'hot money' flowing into the territory.
The local currency hit a two-week high of 7.7940 per US dollar in early afternoon business before pulling back to 7.7972/73 but still firmer than 7.7985/86 in late Asian trade on Thursday.
Meanwhile, the discount on one-year forwards was trading at 710/690 pips by late afternoon after hitting a five-and-a-half-month low of 750 pips, widening from Thursday's close of 630/610 pips.
Hong Kong dollar forwards have fallen sharply in recent sessions as some players close out long US dollar positions amid wobbles for the greenback against major rivals.
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