HONG KONG (Dow Jones)--The Hong Kong dollar rose slightly against the U.S. dollar Monday on tighter supply of the local unit in the interbank market, but trade was lackluster given the absence of market-moving news.
In late Asian trade, the U.S. dollar was at HK$7.7651, down from HK$7.7660 late Friday. The U.S. unit was fixed at HK$7.7650 earlier Monday.
Traders said they expect the U.S. dollar/ Hong Kong dollar pair to remain rangebound this week, with the greenback likely ranging between 7.7640 and 7.7680 Tuesday. They note that the ongoing euro-zone debt crisis is likely to lend support to the safe-haven U.S. dollar in the following few weeks.
"More depositors are shifting their funds from the local currency to the yuan partly due to increasing investment opportunities in the Chinese currency," said a senior trader at a local bank, noting that the move would lead to a tightening supply of Hong Kong dollars in the interbank market.
The one-year U.S. dollar/Hong Kong dollar forward contract was quoted at a premium of 13 points to the spot rate, compared with a 15-point premium late Friday.
-By Chester Yung, Dow Jones Newswires; 852-2832 2331; chester.yung@dowjones.com
