Hong Kong’s de-facto central bank bought the city’s dollar again to defend its foreign-exchange peg, as two previous rounds of intervention failed to send funding costs high enough to dampen bearish currency bets.
The Hong Kong Monetary Authority bought HK$29.6 billion ($3.8 billion) of the currency in New York trading Thursday, a move which drains liquidity from the financial system and can increase borrowing costs. The amount was higher than the HK$20 billion it purchased earlier this week and more than triple the HK$9.4 billion it purchased last week.