Hong Kong Dollar’s Slide Means Intervention Coming, Analysts Say
- Local dollar is set to test 7.85 in matter of days, Daiwa says
- Scotiabank says HKMA may step in support HKD this month
Hong Kong dollar banknotes.
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The Hong Kong dollar is sinking toward the weak end of its trading band and that’s likely to prompt the city’s monetary authority to step in and support the currency in the near future, according to Daiwa Capital Markets and Scotiabank.
Selling of the local dollar has intensified in recent months as a hawkish Federal Reserve has boosted the greenback, while pandemic restrictions in the former British colony have damped its growth outlook. Hong Kong’s currency has slumped 0.6% this year to touch 7.8445 per U.S. dollar on Friday, near the weak end of its 7.75-to-7.85 trading range.