Just a quick look into USD/HKD, which.....>

HONG KONG: Just a quick look into USD/HKD, which has been flirting with the

lower end of its trading band since the beginning of April. China's confirmation

that the NPC will propose a new Hong Kong security bill, effectively tightening

Beijing's control over the city, pushed the rate above its 50-DMA yesterday.

There was an even more notable move in forward and swap markets, with 12-month

forward points hitting best levels since 2016.

- In his keynote address today, Premier Li Keqiang reiterated China's plans to

amend Hong Kong's Basic Law and enact stricter security regulations, while

integrating the city with other municipalities in the region. However, spot

USD/HKD dipped onto its 50-DMA and rests upon it as we type, last -19 pips at

HKD7.7528. Price action has been at odds with the move in forward mkts, with

aforementioned 12-month forward points extending gains to fresh multi-yr highs.

- For what it's worth, that 50-DMA is the initial bearish focus, while bulls

look for a break above Apr 9 high of HKD7.7514.

- Looking ahead, Hong Kong reports its trade data next Monday.