MikeLigalig.com

by pna

Hong Kong's currency authorities have intervened in the currency market for a second week in a bid to stop the local currency from appreciating sharply against the U.S. dollar, officials said Wednesday.

Marking the third day of intervention in two weeks, the Hong Kong Monetary Authority (HKMA) injected HK$ 2.7 billion (US$ 360 million) into the foreign exchange market, the officials at the HKMA said.

The intervention comes as the Hong Kong dollar hit its highest limit late Tuesday amid quantitative easing by economic powers. The greenback was purchased at HK$ 7.75, the lowest limit at which the U.S. dollar is allowed to trade against the Hong Kong dollar.

The move also followed the MKMA's purchase of the greenback last week, which amounted to US$ 1.46 million in total.

Under Hong Kong's exchange rate mechanism, the Hong Kong dollar is pegged at HK$ 7.80 to the U.S. dollar but is allowed to trade between HK$ 7.75 and HK$ 7.85.

The local currency hit its strongest level since the 2008 financial crisis, as central banks in the United States, the eurozone and Japan conducted economic stimulus programs in September, triggering concerns over the possible flow of hot money into Asia's emerging markets.

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