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USD/HKD Drifts Lower, Chief Executive Annual Address Tomorrow

HKD

Spot USD/HKD has drifted lower through the first part of Tuesday trade. Hong Kong markets have returned, but spot USD/HKD remains well within recent ranges. Softness in the pair is in line with broader dollar trends though.

  • We last tracked near 7.8215, with the pair sub all key EMAs, with the 200-day back near 7.8300. Still, dips sub 7.8200 haven't proven sustainable in recent weeks. October lows rest close to 7.8160, late September lows at 7.8136.
  • US-HK short term rate differentials have drifted lower, but the 3 mth spread at +18bps is still above late September lows. 1 month Hibor remains range bound, set at +4.96% today, the 3 month closer to the top end of recent ranges (5.23% today).
  • On the data front, September trade figures print this Thursday.
  • Note tomorrow Hong Kong Chief Executive Jonh Lee delivers his annual policy address (see this BBG link). Focus is likely to rest on measures to boost housing and the equity market.

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