The market bias for GBP to HKD is currently range-bound.
Key drivers include the interest rate differential, as the Bank of England is projected to cut rates, while the Hong Kong Monetary Authority (HKMA) plans to keep rates stable. Recent UK economic indicators show manufacturing growth, yet inflation declines could weigh on the pound. Additionally, the Hong Kong dollar is expected to remain stable against the USD, influencing its valuation against the pound.
The near-term trading range for GBP to HKD suggests fluctuations within the existing 4.2% range, likely moving between the recent levels noted.
An upside risk could arise from unexpected strength in UK economic data, boosting GBP performance. Conversely, a downside risk may stem from further monetary easing by the Bank of England or adverse fiscal developments, both potentially putting pressure on the pound against the HKD, which is currently trading at around 10.51.