HONG KONG (Dow Jones)--The Hong Kong dollar fell against the U.S. dollar for the second consecutive session Friday as some local banks bought into the greenback on bargain-hunting as the local currency and stock market experienced profit-taking.
In late Asian trade, the U.S. dollar was at HK$7.7565, up from HK$7.7555 late Thursday. The U.S. unit was fixed at HK$7.7561 earlier Friday.
Traders said general weakness in Asian currencies was expected over the next few days as the second bailout fund for Greece hangs in the balance given the Greek government's inability to convince creditors of its resolve to push through austerity reforms. They expect the U.S. dollar to trade in a HK$7.7540 to HK$7.7580 band next week.
"Many investors have started to buy the U.S. dollar on dips from the HK$7.7540 level," said a trader at a Singapore bank, adding local banks are key buyers for the greenback.
Another senior trader at a local bank said: "The fall in local stocks and a stronger U.S. dollar offshore also helped to push up the safe haven greenback."
The blue chip Hang Seng Index fell 1.1% at 20,783.86. It rose 0.1% this week.
The one-year U.S. dollar/Hong Kong dollar forward contract was quoted at a discount of 50 points to the spot rate, compared with a 59-point discount late Thursday.
Under Hong Kong's currency board system, the Hong Kong dollar is allowed to trade in a range of HK$7.75 to HK$7.85 to the U.S. dollar.
-By Chester Yung, Dow Jones Newswires; 852-2832 2331; chester.yung@dowjones.com
