(Bloomberg) -- The Hong Kong Monetary Authority on Tuesday bought HK$14.7 billion ($1.9 billion) of local currency, the biggest single-day purchase since it started to defend the dollar peg last week. That took total intervention to HK$33.7 billion. OCBC Wing Hang expects HKMA interventions to remain frequent in the coming months. While that shouldn’t be an issue for the de facto central bank, which has $440.3 billion in foreign reserves at end-March, about seven times the local currency in circulation, the interventions effectively drain liquidity in the banking system and send interbank rates higher.
©2018 Bloomberg L.P.