AFX: Hong Kong dollar steady, stock market in focus
HONG KONG, Dec 10 (Reuters) - The following is a snapshot of the Hong Kong foreign exchange and money market on Thursday.
Latest Previous Day
At 0526 GMT At 0442 GMT
Overnight 0.00001/0.03 0.00001/0.03
One-month 0.02/0.05 0.02/0.05
Three-month 0.06/0.11 0.06/0.11
Six-month 0.15/0.24 0.20/0.25
One-year 0.50/0.54 0.50/0.55
For more live quotes of forwards and interbank rates, click on.
THE HONG KONG DOLLAR HELD WITHIN A NARROW RANGE AGAINST THE U.S. dollar on Thursday, with attention focusing on moves in the stock market and fund flows.
THE LOCAL CURRENCY TRADED BETWEEN 7.7503 AND 7.7506 near the upper end of its tight band to the U.S. dollar.
"THERE IS A RISK OF CAPITAL OUTFLOW IF THE STOCK MARKET continues to fall as investors may take profits after the stock index gained sharply so far this year," a trader said.
HONG KONG STOCKS OPENED HIGHER ON THURSDAY, REBOUNDING FROM four days of losses, but then dipped into negative territory. The Hang Seng Index was down 0.76 percent, while the China Enterprises Index of top locally listed mainland Chinese stocks fell 1.12 percent at the midday break.
A FLOOD OF FUND INFLOW INTO HONG KONG HAS PUSHED THE STOCK market 50 percent higher this year and the residential property prices rose 30 percent.
The influx of capital is putting the Hong Kong dollar under pressure and prompting the Hong Kong Monetary Authority (HKMA) to intervene in the forex market to keep the currency within its fixed trading band.
A total of HK$463.4 billion fund flowed into Hong Kong
between March 20 and Dec. 4, 2009.
THE HONG KONG DOLLAR IS PEGGED AT 7.80 TO THE U.S. DOLLAR but can trade between 7.75 and 7.85. The HKMA is usually obliged to intervene when the local currency hits 7.75 or 7.85.
LOCAL INTERBANK RATES REMAINED AT LOW LEVELS DUE TO abundant liquidity in the banking system after strong capital inflows.
Three-month Hibor was fixed at 0.10821 percent,
easing from Wednesday's 0.10893 percent.
MARKET/ECONOMIC NEWS
> Stock market reports and updates: > Yuan reports and updates: > U.S. dollar reports and updates: > Emerging Asia forex reports and updates: (Reporting by Christina Lo) ((christina.lo.reuters.com@reuters.net; +852 2843 6960; Reuters Messaging:christina.lo.reuters.com@reuters.net))
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