The Hong Kong dollar inched lower on Thursday, while most interbank and forward rates softened as market liquidity improved. The local currency hit a low of 7.7555 per US dollar before pulling back to 7.7552/53 softer than 7.7543/47 in late Asian trade on Wednesday.
A growing yield premium has helped the US dollar, which strengthened to 28-month highs near 120 yen on Thursday. Other rates were slightly softer after some players offered longer-dated money.
The overnight interbank rate was quoted at 3.85/3.90 percent late on Thursday, having hit a session high of 4 percent, one dealer from a local bank said. The overnight interbank rate had touched a high of 4.125 percent on Wednesday. One- and two-week rates were quoted at 3.95/4.00 percent and 4.00/4.05 percent, respectively.
The one-month rate eased 3 basis points to 4.10/4.15 percent from 4.13/4.18 percent in the previous session. The benchmark three-month rate softened to 4.24/4.29 percent versus 4.25/4.30 percent.
Hong Kong dollar forwards moved with the interbank rates. The discount on one-year forwards widened to 180/160 pips from Wednesday's close of 165/150 pips.