Here’s How the Hong Kong Dollar Breaks Its U.S. Dollar Peg

Published on
August 15th, 2022
Duration
44 minutes


Here’s How the Hong Kong Dollar Breaks Its U.S. Dollar Peg

The Essential Conversation ·
Featuring Francis Hunt and Brent Johnson

Published on: August 15th, 2022 • Duration: 44 minutes

Making the call for the failure of the Hong Kong dollar’s (HKD) peg to the U.S. dollar (USD) has itself been a failure – so far. Maybe it was just made too early. Francis Hunt has been observing various signals of stress, as the Hong Kong Monetary Authority has repeatedly stepped in to defend the peg since the Federal Reserve started raising interest rates earlier this year. This time, according to Hunt, it is different. In conversation with Santiago Capital CEO Brent Johnson, he offers an emergency update on the probability the Hong Kong dollar breaks its U.S. dollar peg, an event Hunt considers underpriced by markets. Assessing it from fundamental as well as technical perspectives, “The Market Sniper” underscores the timeliness of the trade setup. Continuing capital flight, declining tax revenue, ever-tightening liquidity, and China’s brewing internal issues all undermine a relationship that dates to 1983. Recorded on August 9, 2022.