Hong Kong has sold more foreign-exchange reserves to maintain its longstanding peg to the U.S. dollar, taking its total outlay this year to $7.24 billion.
The pressure on Hong Kong’s currency is part of turmoil across global foreign-exchange markets. The U.S. dollar has surged as investors adjust to a worsening economic outlook and brace for aggressive action by the U.S. Federal Reserve to bring decades-high inflation back under control. The Fed on Wednesday increased interest rates by the most since 1994.
In recent days, the Japanese yen has touched its lowest levels in 24 years against the dollar, while one broader measure of the U.S. currency’s strength, the WSJ Dollar Index, has advanced to its highest level since 2002.
Hong Kong’s currency has been tied to the U.S. dollar since 1983 and trades within a permitted range of 7.75 to 7.85 Hong Kong dollars per U.S….
