HONG KONG (Reuters) -The Hong Kong Monetary Authority (HKMA) left its base rate unchanged at 4.75% on Thursday, in line with the U.S. Federal Reserve’s decision to keep rates steady.
Major banks followed, with HSBC maintaining its best lending rate in Hong Kong at 5.25%, and Standard Chartered Bank keeping its Hong Kong dollar best lending rate unchanged at 5.5%. Bank of China (Hong Kong) kept its Hong Kong dollar prime rate steady at 5.25%.
Hong Kong’s monetary policy moves in lock-step with the United States as the city’s currency is pegged to the greenback in a tight range of 7.75-7.85 per dollar.
The Fed kept its benchmark overnight interest rate unchanged in the 4.25%-4.50% range, and maintained its projection for two quarter-point interest-rate cuts by year-end. The Fed also forecast slower economic growth and higher inflation.
“Interest rates in Hong Kong might still remain at relatively high levels for some time, and the extent and pace of future U.S. interest rate cuts are subject to considerable uncertainty,” HKMA said in a statement on Thursday.
The public should manage the interest rate risk when making property purchase, mortgage or other borrowing decisions, it added.
Hong Kong financial and monetary markets have continued to operate in a smooth and orderly manner, market liquidity condition remains stable, and the Hong Kong dollar exchange rate remains steady, HKMA said.
(Reporting by Donny Kwok; Editing by Shri Navaratnam and Gerry Doyle)
