The Hong Kong Monetary Authority are defending the 'peg' for USD/HKD, with the HKD at the bottom end of its valuation range

i.e. the top end of the USD/HKD band.

Interbank borrowing rates (reflected in HIBOR) are higher:

  • overnight is at its highest in about 3 weeks (highest since May3)
  • 1 month is at its highest since April 16

The HKMA expects that as it gets more expensive to short the HK dollar fewer people will do so and existing shorts may well throw in the towel.

More here from yesterday: