Hong Kong Monetary Authority responds to the Federal Reserve's interest rate decision

ChainCatcher news, Jinshi reported that the Hong Kong Monetary Authority responded to the Federal Reserve's interest rate decision, stating that the Fed's decision to maintain interest rates is in line with market expectations.

Currently, the interest rate differential between Hong Kong and the U.S. remains attractive for carry trades, which keeps the Hong Kong dollar close to the 7.85 level. However, at the same time, there has been strong demand for Hong Kong dollar funds related to stocks recently, providing some support for the Hong Kong dollar. Moving forward, depending on the changes in the supply and demand for Hong Kong dollar funds, as well as other uncertainties including the Federal Reserve's monetary policy and the direction of U.S. interest rates, the stock investment market atmosphere, external financial markets, and global capital flows, the "weak side convertibility guarantee" may be triggered again. At that time, the Monetary Authority will buy Hong Kong dollars and sell U.S. dollars according to the linked exchange rate system, which will correspondingly reduce the surplus in the banking system, and the Hong Kong dollar interbank offered rate will gradually rise.

There is considerable uncertainty regarding the magnitude and pace of future U.S. interest rate cuts, and the current interest rate environment in Hong Kong may also change due to the aforementioned variables. Citizens should fully consider the possibility of rising Hong Kong dollar interest rates when making decisions about property purchases, investments, or borrowing, and manage related risks. The Hong Kong Monetary Authority will continue to closely monitor market changes to maintain monetary and financial stability.