HK raises benchmark rate after Fed tightens

Local banks like HSBC Holdings Plc, Standard Chartered Plc and Hang Seng Bank Ltd tend to follow the HKMA’s move by adjusting their best lending rates, although they’re not obliged to do so.

HONG KONG: The Hong Kong Monetary Authority (HKMA) raised its benchmark interest rate by 25 basis points, after the United States Federal Reserve (Fed) did the same, saying it wants to maintain stability in the financial system amid heightened market volatility.

The base rate was increased to 0.75% from 0.5%, it said in a statement on its website. The rate moves in lockstep with the Fed’s rate since the Hong Kong dollar is pegged to the US currency.