HKMA sells HK$4.263 bln to keep HK dlr in trading band

"HKMA sells HK$4.263 bln to keep HK dlr in trading band | AboutHK.Com - More Information About HK"

Reuters Hong Kong's central bank, the Hong Kong Monetary Authority, on Tuesday afternoon injected HK$4.263 billion (US$550 million) into the money market to stem an appreciating Hong Kong dollar and keep it within its fixed trading band. The Hong Kong dollar hit the top of its trading band at 7.7500 on Tuesday as money continued to flow into Hong Kong assets, dealers said. Expectations that China's yuan currency will appreciate is further encouraging investors to put money in Hong Kong, they said. According to data on Reuters page, the latest intervention will lift the aggregate balance -- the sum of balances on clearing accounts maintained by banks with the HKMA -- to HK$244.515 billion by Oct. 29. The Hong Kong dollar is pegged at 7.80 to the U.S. dollar but can trade between 7.75 and 7.85 to the U.S. dollar. Under the linked exchange rate mechanism, the HKMA is obliged to intervene in the market to keep the trading band intact if the currency hits 7.75 or 7.85. By 0903 GMT, it was quoted at 7.7500/01. (Reporting by Christina Lo, writing by Susan Fenton; Editing by Chris Lewis)