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Hongkong dollar joins the action

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THE Hongkong dollar found itself among the world's volatile currencies yesterday.

A rush of hot money out of the territory was blamed for another bout of weakness in the rate against the US dollar.

After a similar, but short-lived drop on Wednesday, the local currency hit a day's low of 7.78, a level not seen for the past 18 months.

Dealers reported panic buying of US dollars early in the morning, pushing the rate of the Hongkong dollar down to 7.78. With the pressure coming off later in the day, the rate hardened again to 7.7480.

Various reasons were given for the early panic selling.

''The market reacted strongly to Moody's announcement that Hongkong might not retain its present credit rating after 1997, and that caused a bit of a confidence crisis,'' said one dealer.

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