Hong Kong's Bold Currency Move: $7.8 Billion Intervention
Hong Kong's central bank intervened with a $7.8 billion purchase to prevent the local currency from strengthening beyond its fixed range against the U.S. dollar. The peg limits the HKD between 7.75 and 7.85 per USD. This move will raise the banking system's aggregate balance significantly.
In a decisive move to maintain its currency stability, Hong Kong's de-facto central bank executed a $7.8 billion intervention on Tuesday. The action aimed to prevent the local currency, the Hong Kong dollar, from strengthening beyond its pegged range against the U.S. dollar.
The Hong Kong dollar is tightly controlled within a band of 7.75 to 7.85 per U.S. dollar, a measure that safeguards against excessive currency fluctuations.
An official from the Hong Kong Monetary Authority confirmed that this intervention will elevate the aggregate balance of the banking system by HK$116.6 billion on May 7, underscoring the authority's commitment to financial stability.
(With inputs from agencies.)
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