HKMA sells $13.4b to defend peg

Business | Bloomberg 10 Jul 2020

Demand for Hong Kong dollars is intensifying in the face of an increasingly politicized environment, with mainland buying helping to buoy both the pegged currency and local stock market.

The city's de facto central bank sold HK$13.4 billion to purchase the greenback yesterday, taking the total it has spent this year to keep the local currency from strengthening further to US$13.5 billion (HK$105.3 billion).

Some Trump aides are considering plans to undermine the peg mechanism in retribution for Beijing's crackdown on civil liberties in the former British colony, Bloomberg reported Wednesday. Mainland-based investors showed their support for the city through buying more than $1 billion worth of Hong Kong shares on the day.

The Hong Kong dollar traded at 7.75 versus the greenback yesterday evening.

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