The Hong Kong dollar inched higher and discounts on forward rates widened on Thursday amid lingering speculation of a potential yuan revaluation, dealers said. "There were some big names selling forwards. I think it might be related to the yuan issue," said a dealer from a Japanese bank. After shuffling between 7.7978 and 7.7991 per US dollar, the local currency traded at 7.7984/85 up from 7.7988/89 on Wednesday. The discount on one-year Hong Kong dollar forwards widened to a one-week low of 1,430/1,410 pips from Wednesday's close of 1,360/1,340 pips.
Some traders see the HK dollar as a proxy to the Chinese currency as the two economies become increasingly integrated, though others have scoffed at any linkage.
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