The Hong Kong dollar was trapped in a tight range against the US dollar on Tuesday amid a dearth of fresh market-moving news. "With the holiday season looming, trading has thinned," one trader at a local bank said. After shuffling between 7.7795 and 7.7808 per dollar, the local currency traded at 7.7803/04 versus 7.7794/96 in late Asian trade on Monday.
"Some overseas investors who had subscribed to the city's US $3 billion real estate investment trust (REIT) IPO, have been converting their money back into US dollars in recent sessions after the issue was called off," the trader said. "However, the amount of such transactions was moderate."
Meanwhile, discounts on Hong Kong dollar forwards continued to widen on the back of softer local short-term money rates, dealers said.
The overnight interbank rate was quoted at 0.37-0.43 percent by late afternoon, and the one- to three-month rates were at 0.33-0.35 percent.
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