The Hong Kong dollar was slightly firmer against the US dollar on Friday after moving in a narrow range, while interbank rates were mixed. The local currency traded between 7.7502 and 7.7505 on the day, ending marginally higher than late Thursday trade in Asia.
"The spot (USD) was still heavy," one dealer said, adding that some real money had been flowing in and parked in Hong Kong for investment opportunities. Some dealers projected the USD/HKD spot rate to continue moving within a range between 7.7500 and 7.7510 next week. The Hong Kong currency is pegged at 7.80 to the US dollar but can trade between 7.75 and 7.85.
In the interbank market, short-dated rates remained at low levels because of abundant liquidity in the banking system. The overnight rate was quoted at 0.0001 percent. But longer-dated interbank rates were marked higher on Friday, taking their cue from a rise in Hong Kong dollar interest rate swaps after a spike in US bond yields overnight, dealers said.
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