Connect with us

Popular World News

Hong Kong Follows Fed, Cuts Base Rate for First Time Since 2008 By Bloomberg

Hong Kong Follows Fed, Cuts Base Rate for First Time Since 2008 By Bloomberg


Hong Kong Follows Fed, Cuts Base Rate for First Time Since 2008 By Bloomberg


(Bloomberg) — The Hong Kong Monetary Authority cut its benchmark interest rate in line with the U.S. Federal Reserve, opening the door for lower retail borrowing costs to boost the sagging economy.

The HKMA on Thursday lowered its base rate to 2.5% from 2.75%, in step with the Fed’s quarter point move. As the Hong Kong dollar is pegged to the greenback, the city essentially imports U.S. monetary policy.

The first base rate reduction in more than a decade comes as the city is facing the economic downdraft from slowing global trade, China’s weakening expansion and political turmoil at home. Gross domestic product contracted 0.3% from the previous quarter, while growth on a year-ago basis remained at 0.6%, according to data released on Wednesday.341647551

The rate Hong Kong banks charge each other for loans over three months has fallen sharply in July, offering some leeway for lenders to follow the HKMA’s move and in turn lower their borrowing costs to retail customers.

The HKMA is now in a transitional period, with chief executive Norman Chan set to be replaced in October by his long-time deputy Eddie Yue, who will have to face risks ranging from a resurgent property market to intermittent sniping against the city’s currency peg.

To contact Bloomberg News staff for this story: Yinan Zhao in Beijing at

To contact the editors responsible for this story: Jeffrey Black at, Chris Bourke

©2019 Bloomberg L.P.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.


Source link

Continue Reading
You may also like...
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *


To Top
error: Content is protected !!