The Hong Kong dollar regained ground on Monday as some players unwound long US dollar positions in the wake of firmer short-dated money rates.
The currency, which is allowed to trade between 7.75 and 7.85 to the US dollar, was trading at 7.7540/41, firmer than Friday's close of 7.7551/53.
The Hong Kong dollar had weakened to a three-week low of 7.7556 on Friday, following a rally in the US dollar against the yen.
"Short-dated money was a little tighter because of the IPO, prompting some people to sell US dollars in order to get Hong Kong-dollar funding," said a dealer at a European bank, adding that the tomorrow next and one-week Hong Kong dollar forwards rising to a premium from a discount.
The discount on one-year forwards tightened to 460/445 pips from 470/460 pips late on Friday.
One dealer at a local bank said some players were keen to borrow tomorrow/next to two-week money.
The one-week interbank rate was quoted at 4.95/5.00 percent, rising from Friday's 4.80/4.90 percent. The two-week rate firmed to 4.75/4.85 percent, compared with 4.75/4.80 percent late on Friday.