HONG KONG, March 21 (Reuters) - The Hong Kong dollar hit a 33-year low on Wednesday, inching closer to the lower end of the monetary authority’s targeted trading band, as the interest rate gap between U.S. dollar rates and Hong Kong counterpart widened further.
The former British colony pegs its currency to the greenback, and hence, its money market rates mirror that of its U.S. counterparts.
The Hong Kong dollar fell to a new 33-year of 7.8462 per dollar on Wednesday.
The Hong Kong Monetary Authority, the city’s de facto central bank, has pegged the local currency at 7.8 to the U.S. dollar since 1983, but it allows it to trade between 7.75 and 7.85. (Reporting by Donny Kwok; Editing by Sherry Jacob-Phillips)