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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
USD/HKD continued to gravitate higher on Monday, getting near 7.8395 in the NY session, before sentiment stabilized somewhat. We last tracked at 7.8385, just shy of these levels. HKD paid little attention to the to the pull back in USD/CNH.
- The US-HK 3 month yield differential remains in an uptrend, although more so driven by the move down in Hibor 3 month rather than firmer US yields (3 month Hibor back sub 5.00%). The chart below overlays spot USD/HKD against the 3 month differential.
- HKD bears will eye a move towards earlier June highs near 7.8440. We are also seeing some uptick in the risk reversal space, with the 1 month near -0.30.
- Less action is evident in terms of the 12 month outright, we remain wedged sub 7.7800 for now. The 6 month is above 7.80, the 3 month near 7.8170.
- Yesterday's July CPI data showed benign inflation pressures, printing at 1.8% y/y, versus 1.9% forecast (the June read was 1.9%).
Fig 1: USD/HKD & US-HK 3 Month Yield Differential
Source: MNI - Market News/Bloomberg
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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