Hong Kong authority intervenes in market to check local currency's rise
HONG KONG, May 3 (Reuters) - Hong Kong's de-facto central bank said it sold HK$46.54 billion ($6 billion) into the market on Saturday to prevent the local currency from strengthening beyond its official peg to the U.S. dollar, the first such intervention in more than four years.
The Hong Kong dollar is pegged to a tight band between 7.75 and 7.85 per U.S. dollar.
The Hong Kong Monetary Authority intervened as the Hong Kong dollar touched the strong side of that currency convertibility range. The last time it sold Hong Kong dollars to defend the peg was in October 2020.
"Seeing the HKD getting stronger means capital inflows, which is not problematic for Hong Kong," said Gary Ng, senior economist at Natixis.
The aggregate balance, the key gauge of cash in the banking system, will increase to HK$91.31 billion on May 7, an HKMA spokeswoman said on Saturday.
($1 = 7.7500 Hong Kong dollars)
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