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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
HKD
Spot USD/HKD spent much of yesterday trending higher. We got to highs above 7.8080 late in NY trade, but sit closer to 7.8075 in current dealings. This is highs in the pair back to July 26. Note the 20-day EMA comes in close to 7.8100, while the 50-day is higher at ~7.8200.
- The grind higher in USD/HKD is broadly in line with the recent firming in the USD backdrop, coupled with higher UST yields. US-HK short term interest spreads are only a touch above recent lows though.
- The USD/HKD 1 month risk reversal is firming. We were last at -0.31, which is highs in this metric back to February of this year, see the chart below.
- In the forward space, USD/HKD 12 month outright sits only a touch above recent lows, last in the 7.7660/70 region. Shorter dated tenors have seen more upside in line with spot moves, the 6 month back to 7.7870, the 3 month tracking near 7.8000.
- The data calendar is empty until next week when FX reserves print, along with Q2 GDP revisions. To recap, yesterday saw a dip in the PMI to 49.4 from 50.3, which is back to levels from the end of 2022.
Fig 1: USD/HKD & 1 Month Risk Reversal
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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