| Abstract | During the September quarter of 1995, the HK dollar exchange rate remained stable. Alongside the strenghtening of the US dollar, the Effective Exchange Rate Index (EERI) of the HK dollar rose by around 3% during the quarter. In response to some easing of the HK dollar against the US dollar in mid-August, the Hong Kong Monetary Authority (HKMA) reduced the level of interbank liquidity, resulting in the short term HK dollar interest rates edging up. The money market remained tight until the end of the quarter as a result of strong demand for liquidity, particularly from foreign authorised institutions, to meet quarter-end settlement needs. |
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