As futures traders delay expectations as to the timing of a Federal Reserve benchmark rate increase, the US Dollar has softened against nearly all of its major peers. The Hong Kong Dollar, meanwhile, has ticked higher on inflation data, although gains are slow under the umbrella of riots.
The US Dollar to Hong Kong Dollar exchange rate is currently trending in the region of 7.7561.
A lack of US domestic data on Monday, coupled with vastly improved market risk-sentiment, saw the US Dollar exchange rate drop against many of its most traded currency competitors. Anxieties over the snail-paced global economic recovery have also aided the ‘Greenback’ downtrend.
The Hong Kong Dollar generally depreciated across the board from negative sentiment regarding the student-led riots. The protests, which broke out over three weeks ago, have been led by students demanding reforms on how Beijing vets Hong Kong candidates for elections as well as calling for the resignation of the current leader.
The US Dollar to Hong Kong Dollar exchange rate has fallen to a low today of 7.7559.
On Tuesday the US Dollar extended losses after futures traders pared bets as to the timing of Federal Reserve monetary policy normalisation. Candice Zachariahs, writing for Bloomberg, stated; ‘Futures traders estimate a Fed interest-rate increase at 46 percent odds by October 2015, down from 51 percent at the end of last week. They saw a 52 percent chance for the Fed to tighten in July as recently as Oct. 3.’
However, Yujiro Goto, a currency strategist in London at Nomura Holdings Inc., stated; ‘We think it is still possible for the Fed to start tightening in the first half of next year, as the market re-examines the timing, the Dollar is still expected to rise against the Euro and Yen over three-to-six months.’
Meanwhile, the Hong Kong Dollar gained a little momentum after inflation data printed positively. The Inflation Rate was forecast to decline from 3.9% to 3.89%, but the actual result advanced to 6.60%. RTT News said; ‘The larger inflation figure in September was mainly due to the low base of comparison resulted from the Government’s payment of public housing rentals in September last year.’
US Dollar to Hong Kong Dollar Forecast to Gain
After traders digest the delay to a Fed rate hike and as the Hong Kong riots continue, the USD/HKD exchange rate is likely to strengthen, especially with an absence of Hong Kong data on Wednesday.
Wednesday’s US inflation data is very likely to spark volatility for the ‘Buck’ (USD).
The US Dollar to Hong Kong Dollar exchange rate has advanced to a high today of 7.7589.
Hong Kong Dollar (HKD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,
,Hong Kong Dollar,12.5258 ,
Euro,, Hong Kong Dollar,9.8708 ,
US Dollar,, Hong Kong Dollar,7.7562 ,
[/table]
