HONG KONG, Sept 19 (Askume) – The Hong Kong Monetary Authority (HKMA) on Thursday cut its overnight discount window benchmark interest rate by 50 basis points to 5.25%.This follows steps taken by the Federal Reserve.
Hong Kong’s monetary policy follows the example of the United States, with the RMB exchange rate against the US dollar kept stable within a narrow range of 7.75 to 7.85.
The monetary authority said the US interest rate cut would have a positive impact on the Asian financial hub’s economy and create some room for local interest rates to ease.
Lee Tak-chi, acting chief executive of the Hong Kong Monetary Authority, told reporters: “Hong Kong’s financial and currency markets are operating smoothly and orderly. Market liquidity conditions remain stable, and the Hong Kong dollar exchange rate remains within the variability range. Remains within.”
Li said: “Although the interest rate reduction cycle has just started, interest rates will remain at a high level in the near future. The public should carefully assess interest rate risks when deciding to buy property, take out mortgages or other loans, and must continue to do so.
Among Hong Kong’s major banks, HSBC has reduced its Hong Kong prime lending rate by 25 basis points to 5.625%, effective September 20. The Bank of China (Hong Kong) said it will reduce its Hong Kong prime lending rate by 5.85%, effective September 23.
Hang Seng Bank chief economist Thomas Schick said: “Although there is still uncertainty about future US interest rates, the direction is gradually becoming clear. Hong Kong interest rates are also expected to fall accordingly, which will boost Hong Kong’s economy.” “Economic growth will be supported.”
On Wednesday, the Federal Reserve began an expected series of rate cuts, starting at half a percentage point more than usual, and policymakers expect another 50 basis point reduction in 2024.
Morgan Stanley said in a research note, “Low interest rates are intuitively good for real estate, but it will have a disproportionate impact on Asian real estate markets and stock markets.” He said that the fall in mortgage rates will provide more opportunities for Hong Kong than Singapore. Lots of support.
