HongKong Dollar undervalued ?

Discussion in 'Trading' started by trillenium, Dec 22, 2003.

  1. As far as I understand we have a big US Dollar weakness at the moment. As the US Dollar went down it dragged the HongKong Dollar down with it because HongKong Dollar is pegged to the US Dollar. Gold on the other hand is quoted in US Dollar and went up a lot so that it remained stability versus the Euro and other currencies. HongKong Dollar on the other hand could not do that. Therefore I think the HongKong Dollar is heavily undervalued especially versus the Euro.

    My idea is now to buy HongKong Bonds in HongKong Dollars or China Bonds in the Chinese currencies. Sooner or later the Chinese government has to give up on the fixed currency system.

    My Question: How can I buy those bonds without paying super high commissions ?

    Any ideas on other stuff that got dragged down by the Dollar ?
  2. my question is: when they do let the hongkong $ float will it intial drop like most currency's(ie argentina) when they break free from the US$ peg. Also is there any talk of the Hongkong $ breaking free of the peg, if not who know how long it will take or if it will ever happen.
  3. Bloomberg news this morning: China is studying tying their currency to a basked of currencies of their trading partners. Thus a basket of USD, Yen, Euro, & several Asian currencies, in proportion to the amount of trade they do w/ China.

    When this happens it will be sudden ... I would expect it, or some adjustment like it, at any time.