The Hong Kong dollar has dived to a four-month low, falling by the most since 2003 as worries grow that the peg is about to break. The currency fell by as much as 0.28%, reaching the lowest level in four years at HK7.781 against the U.S. dollar. Activist investor Bill Ackman is being hit by today’s nosedive, as he was betting that Hong Kong would amend its peg to the dollar, which has been in place for 32 years.

Hong Kong Dollar

Hong Kong dollar plunges in value

Clearly the options market is highly skeptical that Hong Kong‘s central bank will revalue its currency, as Bloomberg reports that the market is estimating a 27% chance that the currency will become weaker than the allowed trading range, which is between HK$7.75 and HK$7.85, by the end of this year. That’s an increase from the 9.5% likelihood the options market was assigning at the end of December, according to the media network’s data.

China’s economic woes are taking a toll on Hong Kong’s markets as the offshore yuan fell by as much as 0.7% following last week’s five-year low. BNP Paribas foreign exchange and interest rate strategy head Mirza Baig told Bloomberg that although the depreciation of the yuan does push demand for the city’s dollar, there’s another factor in play now, which is the renminbi’s devaluation. He believes that if the renminbi weakens much further, Hong Kong might not be able to avoid speculations about de-pegging.

Ackman still won’t realize his options bet

Since October, the Hong Kong Monetary Authority has injected nearly $14 billion in efforts to support the currency. The fall of the city’s dollar forced the agency to purchase U.S. dollars on the foreign exchange market. Bloomberg reported on Wednesday that the financial services secretary, K.C. Chan, said that there’s no question about the currency’s peg and that Ackman is going to be disappointed because he doesn’t expect the investor’s bet to be realized.

Ackman said in October that he was holding his call options on the Hong Kong dollar and suggested a revaluation of the currency higher by 30% compared to the U.S. dollar. The activist investor said this would help the city tamp down inflation.

If the Pershing Square chief’s loss on his bet on the Hong Kong dollar peg sounds familiar, it’s the same story we heard in November 2011 when HK Tsang’s CEO said he would lose a lot of money on that same bet. At the time, the bet was one of the activist investor’s favorite bets as he said at that time that it was one of the world’s most undervalued currencies and the payoff was much higher than his cost of investment.

This is another blow for Ackman who is having a very rough 2016.