News

According to Jinse Finance, the Hong Kong Monetary Authority (HKMA) has responded to the US Federal Reserve's interest rate decision, stating that the Fed's decision to keep rates unchanged was in line with market expectations. Currently, the interest rate differential between Hong Kong and the US continues to make carry trades attractive, keeping the Hong Kong dollar close to the 7.85 level. At the same time, there has been strong demand for Hong Kong dollars related to stock transactions recently, which has provided some support for the currency. Going forward, the triggering of the "weak-side Convertibility Undertaking" will depend on changes in the supply and demand for Hong Kong dollar funds, as well as other uncertainties such as the Fed's monetary policy, the direction of US interest rates, sentiment in the stock investment market, external financial markets, and global capital flows. If triggered, the HKMA will buy Hong Kong dollars and sell US dollars in accordance with the Linked Exchange Rate System, resulting in a decrease in the aggregate balance of the banking system and a gradual rise in Hong Kong dollar interbank rates. There is considerable uncertainty regarding the magnitude and pace of future US rate cuts, and Hong Kong's current interest rate environment may also change due to these various factors. Residents should fully consider the possibility of rising Hong Kong dollar interest rates and manage related risks when making decisions about property purchases, investments, or borrowing. The HKMA will continue to closely monitor market developments and maintain monetary and financial stability. (Jin10)