Hong Kong’s dollar dropped the most in 10 months as a halt in the yuan’s slide curbed safe-haven demand for the city’s currency.

The yuan steadied on Friday, after weakening 1.2 percent over the previous two days, as the central bank set its daily fixing slightly stronger. The conversion of Chinese-currency deposits by local residents has been driving demand for the Hong Kong dollar, BNP Paribas SA said in a research note on Monday. The city’s dollar has been pegged in a range of HK$7.75 to HK$7.85 against the greenback since 2005.

Hong Kong’s dollar fell 0.06 percent, the most since March 2015, to 7.7570 against its U.S. counterpart as of 5:59 p.m. local time, Bloomberg-compiled data show. The currency dropped to 7.7599 earlier, the weakest since Dec. 1, and is down 0.09 percent this week. That compares with declines of 2.1 percent in Malaysia’s ringgit and 1.7 percent in Singapore’s dollar.

“The key reason is the yuan,” said Andy Ji, a Singapore-based foreign-exchange strategist at Commonwealth Bank of Australia. “The Hong Kong dollar was a safe haven this week amid the volatility, and now that sentiment has improved for the yuan we’re seeing money move away from the Hong Kong dollar.”

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