HKMA sells HK$3.875 bln to keep HK dlr in trading band

HONG KONG Nov 19 (Reuters) - Hong Kong's central bank, the Hong Kong Monetary Authority (HKMA), on Thursday morning injected HK$3.875 billion ($500 million) into the money market to stem an appreciating Hong Kong dollar HKD= and keep it within its fixed trading band.

The Hong Kong dollar hit the top of its trading band at 7.7500 on Thursday morning as money poured into the territory, partly attracted by initial public offerings in the stock market, dealers said. Recent market expectations that China could soon resume appreciation of its yuan CNY=CFXS currency were also making Hong Kong assets attractive, analysts say. According to data on Reuters page HKMAOOC, the latest intervention will lift the aggregate balance -- the sum of balances on clearing accounts maintained by banks with the HKMA -- to a record HK$319.929 billion by Nov. 23.

The Hong Kong dollar is pegged at 7.80 to the U.S. dollar, but can trade between 7.75 and 7.85 to the U.S. dollar.

Under the linked exchange rate mechanism, the HKMA is obliged to intervene in the market to keep the trading band intact if the currency hits 7.75 or 7.85.

By 0232 GMT, it was quoted at 7.7500/01. (Reporting by Christina Lo; Editing by Jacqueline Wong)