Speculators circled the Hong Kong dollar yesterday but undue pressure on the currency was avoided thanks to the Hong Kong Monetary Authority's decision to release more details of liquidity in the interbank market, according to dealers. The authority confirmed it had noticed some speculative activity on the Hong Kong dollar after it revealed on Thursday there would be a negative balance in the system yesterday. Observers said the interbank market yesterday could have seen a repeat of last October's Black Thursday - when interbank rates shot to a record high of 300 per cent - were it not for the HKMA's decision to release the additional information. Short-term interbank rates, however, moved sharply higher on fears an exodus from Asian currencies sparked by the yen's continued decline could further tighten local liquidity. Yesterday, the benchmark three-month interbank rate hit a high of 15 per cent and closed at 13 per cent from 12 per cent the previous day. Offers for one-month interbank borrowing hit as high as 14 per cent before ending the day at 13.5 per cent from Thursday's 13 per cent. International Bank of Asia senior vice-president Davy Kwan Kwok-ki said yesterday's interbank rates would have been even higher if the authority had not introduced the new measures. Due to the authority's announcement that there would be a negative aggregate balance in the clearing accounts yesterday, banks were able to prepare their additional funding needs ahead of settlement, Mr Kwan said. 'Before, banks could only guess the position of Hong Kong-dollar liquidity which sometimes caused panic,' he said. As part of its new disclosure regime, the HKMA said there was a possibility the aggregate balance in clearing accounts held by banks for foreign exchange settlements would be minus $5.27 billion next Tuesday. The negative balance yesterday showed some players were selling the Hong Kong dollar to the HKMA, pushing the spot Hong Kong dollar exchange rate to 7.7495. The dollar traded on Thursday between $7.746 to $7.747. The authority's warning there would be a negative aggregate balance yesterday allowed banks to move quickly to cover their funding shortfalls. The overnight interbank rate closed at 10 per cent yesterday against Thursday's 4.5 per cent. Traders attributed the surge to banks' reluctance to dip into the authority's liquidity adjustment facility (LAF) discount window, preferring instead to incur higher rates by borrowing in the interbank market. The authority discourages frequent use of the LAF, fearing it could become a source of Hong Kong dollars for speculators.