H. Kong holds base rate unchanged at 5.75%

The Hong Kong Monetary Authority (HKMA) kept its base rate at 5.75 per cent in line with the US Federal Reserve’s decision to maintain rates, according to Reuters on Thursday.

Fed Chair Jerome Powell reiterated the plan for three rate cuts this year, citing stable economic growth and easing inflation pressures.

HKMA expects the Fed to cut rates by a total of 75 basis points this year, but the timing and future rate adjustments are uncertain.

The high interest rate environment may persist for some time, impacting Hong Kong’s financial and monetary markets.

Despite this, HKMA reassured that Hong Kong’s dollar exchange rate remains stable. HSBC Holdings confirmed its lending rate in Hong Kong at 5.875 per cent.

Hong Kong’s monetary policy aligns with the US as the city’s currency is pegged to the dollar within a narrow range of 7.75-7.85 per dollar.