Photographer: Xaume Olleros/Bloomberg

Dollar Pegs Seen Bending While Reserves Keep Them From Breaking

  • Option traders see 41% chance of Hong Kong dollar testing peg
  • Saudi Arabia and Hong Kong hold $1 trillion reserves to defend

Countries with currencies pegged to the dollar are coming under increasing attacks by traders who bet it’s become too expensive for policy makers to continue defending exchange rates amid a soaring greenback and a collapse in commodities prices. It may be the speculators who end up losing.

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