China News Service, July 28. According to Hong Kong Wenhui.com, the Hong Kong Monetary Authority announced today (28th) that in response to the US Federal Reserve raising interest rates by 0.75%, it will immediately raise the discount window base rate by 0.75% to 2.75%.
Yu Weiwen, president of the Hong Kong Monetary Authority, said the rate hike will not affect the stability of Hong Kong's monetary and financial markets.
Yu Weiwen said that the Federal Reserve has raised interest rates by 0.75% for two consecutive months. Since March, it has raised interest rates four times, adding a total of 2.25%. The market generally believes that it is not easy for the Federal Reserve to meet high inflation and maintain economic growth.
The Fed will continue to raise interest rates, and it has also indicated that it will not provide clear forward guidance, so the pace of future interest rate hikes is full of uncertainty.
However, he stressed that the US interest rate hike will not affect the stability of Hong Kong's monetary and financial markets.
Yu Weiwen said that the widening of the interest rate gap between Hong Kong and the United States has led to carry trades. In addition, the demand for Hong Kong dollars has been weak in recent months. Since May, the weak-side exchange guarantee has been triggered many times. Gradually rising, the incentives to offset the carry trade have kept the Hong Kong dollar stable in the range of 7.75 to 7.85, which is within the expectations under the linked exchange system. You don’t need to worry about it. This happened from 2015 to 2018. Have sufficient understanding and experience.