Hong Kong raises interest rates after Fed

China's Hong Kong Special Administrative Region increased at the same rate due to the exchange rate regime tied to the US dollar, after the US Federal Reserve (Fed) increased the interest rate by 75 basis points.

The Hong Kong Monetary Authority (HKMA) increased the benchmark interest rate by 75 basis points to 2 percent.

The Fed had increased its short-term policy rate by 75 basis points to the range of 1.50-1.75 percent. The increase was the fastest rate hike since 1994.

The base interest rate of the HKMA, after the simultaneous step with the Fed, reached the level in March 2022, when central banks in the world started to apply interest rate cuts in order to provide cheaper credit resources to support the economic recovery at the beginning of the Kovid-19 epidemic.

Last month, the HKMA followed the Fed's decision to increase interest rates, raising the benchmark interest rate by 50 basis points to 1.25%.