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Speculators are right: Hong Kong's dollar peg does more harm than good

Hedge funders on the attack must compete with Xi Jinping's resistance

| Hong Kong, Macao
Hong Kong's currency peg to the U.S. dollar has long been touted as its secret weapon.   © Reuters

Hong Kong's currency peg to the U.S. dollar is the ultimate "widow-maker" trade.

For more than two decades, hedge fund managers, George Soros most famously, have tested the Hong Kong Monetary Authority's resolve. At every turn, investors went away none the richer. Through assertive market intervention and fancy footwork, the HKMA preserved a 7.8 exchange rate established in 1983.

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