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The pace of interest rate hikes in the United States is expected to slow down. The analysis indicates that the Hong Kong Bank’s P increase is nearing the end, and the interest rate of medium and long-term fixed deposits has peaked

2023-02-01T04:35:20.407Z


On the eve of the Federal Reserve's interest rate meeting, the market expects that it will slow down the pace of raising interest rates to 0.25%. The one-month mortgage-related interest rate (Hibor) has fallen for 7 consecutive days to 2.7% on Tuesday. In the medium and long term, Hibor also fell across the board. and in fact


On the eve of the Federal Reserve's interest rate meeting, the market expects that it will slow down the pace of raising interest rates to 0.25%. The one-month mortgage-related interest rate (Hibor) has fallen for 7 consecutive days to 2.7% on Tuesday.

In the medium and long term, Hibor also fell across the board.

In fact, Hong Kong banks have recently lowered the interest rate of Hong Kong dollar time deposits one after another, contrary to the rush for deposits at the end of last year. At present, the 1-year period has fallen below 5% across the board, which is consistent with the trend of Hibor.

Some analysts predict that the Bank of Hong Kong may not necessarily follow the increase of the prime rate (P) if it has the opportunity this time. Even if it increases, it will only increase by 0.125%, which will not follow the Fed.

With the expectation of interest rate cuts rising, the interest on medium and long-term fixed deposits of banks in Hong Kong is expected to have peaked, and it will be difficult to recover 5% or more for one-year periods.


On the eve of the Federal Reserve's interest rate meeting, the one-month mortgage-related interest rate (Hibor) fell for 7 consecutive days to 2.7% on Tuesday.

In the medium and long term, Hibor also fell across the board.

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1-month interest rate fell for 7 consecutive days

Except for overnight Hibor, which rose 19.55 pips to 1.49548%, the rest fell across the board on Tuesday, among which the one-month Hibor fell 6.58 pips to 2.70571%.

Hibor fell 0.74 points to 1.9231% in 1 week, and fell 1.33 points to 2.3472% in 2 weeks.

In terms of medium and long-term interest rates, the 3-month Hibor fell 2.19 points to 3.67256%, the 6-month fell 3.59 points to 4.15524%, and the 12-month fell 0.98 points to 4.69714%.

Since the beginning of the new year, banks in Hong Kong have lowered interest rates on fixed deposits, especially medium and long-term interest rates. Among them, the "high interest king" Fubon's one-year fixed deposit rate has dropped to 4.1%, while NCB is still at 5% last month, but It has fallen to 4.3% at present, and Chong Hing has fallen further to 4.05%.

CCB Asia has also lowered the Hong Kong dollar time deposit several times, and the current 3-month, 6-month and 1-year terms are only 3.65%.

Hong Kong banks have recently lowered the interest rate of Hong Kong dollar time deposits one after another. Contrary to the rush for deposits at the end of last year, the current 1-year period has fallen below 5% across the board, and the current highest is 4.3% of CNCBI, with a minimum deposit of only 10,000 yuan.

(Photo provided by CNCBI)

The 1-year Hong Kong dollar time deposit has fallen below 5% across the board

Compared with the current 1-year Hong Kong dollar time deposit interest, the highest is 4.3% of CNCBI, and the initial deposit is only 10,000 yuan.

For 6 months, Hang Seng’s 4.68% online renewal discount for selected customers is the highest, and the minimum deposit is 10,000 yuan.

3 months is the highest for Citigroup at 4.88%, and the minimum deposit is 50,000 yuan, but it must be a private client of Citigroup or a new client of Citigold, and hold a designated product balance.

Lin Junhong, director of the research department of Shanghai Commercial Bank, said that the interest rate of Hong Kong dollar time deposits has fallen to a stable level. It is difficult to rise further, or it has "peaked" at the current level. As the pace of US interest rate hikes approaches, it is expected to slowly decline.

Investors who are currently interested in fixed deposits are advised to consider long-term deposits to lock in interest.

Lin Junhong said that the medium and long-term Hong Kong dollar time deposit interest has "peaked", and as the US interest rate hike is approaching, it is expected to slowly decline. Investors who intend to make a fixed deposit are suggested to consider long-term deposits to lock in interest.

Lin Junhong: Bank of Hong Kong's medium and long-term fixed deposit interest has peaked

He predicts that after the Federal Reserve raised interest rates by 0.25% this time, it will continue to raise interest rates by 0.25% twice in March and May, and will stop when it reaches a high of 5.25%.

There is a greater chance of maintaining this level of interest rates in the second half of the year, and there is no chance of reducing interest rates until next year.

Li Ruofan, Global Market Strategist at DBS Hong Kong Treasury Markets Department, also expects that the Federal Reserve will not cut interest rates until next year, but will complete the pace of raising interest rates in the first quarter (March).

After raising the interest rate by 0.25% this time, it is expected that Hibor will gradually rise to catch up with the US interest rate, and the fixed deposit interest rate is also expected to increase. However, it is expected to "peak" at the end of last year, and the increase will not be too large. Among them, the 12-month Hong Kong dollar Fixed deposit materials are difficult to reproduce by 5%.

Li Ruofan: Hong Kong dollar fixed deposit is difficult to reproduce 5%

She also pointed out that the recent fall in Hibor has widened the interest rate gap between Hong Kong and the United States. In addition, the previous increase lagged behind. It is expected that the Bank of Hong Kong will still increase P by 0.25% to 0.125% this time along with the United States, and it will follow after a further increase of 0.125% in March. Then peaked.

After the Federal Reserve raised interest rates by 0.5% in December last year, the four major banks raised P0.25%, which is the third time since this round of US interest rate hike cycle. Among them, HSBC, Hang Seng and Bank of China Hong Kong have increased to 5.625%, and Standard Chartered has increased to 5.875% .

Lin Junhong said that the recent drop in Hibor reflects that Hong Kong banks have fallen back following the pressure of interest rate hikes, but current and savings deposits (CASA) funds have flowed out, and it is estimated that the main outflows are time deposits and the stock market, so it is expected that Hong Kong banks still have opportunities this time Follow the United States to increase P, the increase rate is 0.25 to 0.125%, but it is expected that the increase of P is coming to an end.

Zhuang Jinhui said that referring to past experience, Hong Kong banks may not follow the Fed to increase P this time, even if the increase rate will not be sufficient, but prospective owners need to pay attention to the high interest rate environment will remain for a long time until the end of the year or early next year. Will cut interest rates.

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Zhuang Jinhui: Bank of Hong Kong plus P is expected to lag behind the Fed

Cao Deming, the chief vice president of Meridian Mortgage Referral, said that the actual interest rate of H is still far from the capped interest rate. Considering cost-effectiveness, Hong Kong Bank still has the opportunity to increase P after the US interest rate hike. However, Hibor has fallen recently and Bank balances are still ample, and the increase is expected to be only 0.125%.

As for whether it will increase in the future, it will depend on factors such as the interest rate and the trend of Hong Kong funds.

Zhuang Jinhui, CEO of Star Valley, said that referring to past experience, Hong Kong banks may not follow the Fed to increase P this time, even if the rate of increase will not be sufficient, but prospective owners need to pay attention to the high interest rate environment will remain for a long time until the end of the year Or the United States will cut interest rates early next year.

Wang Meifeng, managing director of Centaline Mortgage, said that the current one-month gap between Hibor and P is about 2.9%, lower than the previous average of more than 3%, and the interest rate of H is still higher than the capped interest rate. Pressure on interest rate differentials; in addition, the Bank of Hong Kong has lagged behind the U.S. interest rate increase in this rate hike cycle, so it is expected that there is still a chance to follow the increase in P this time, but it will ultimately depend on factors such as its cost of funds, deposit and loan demand.

Interest rate hike|The four major banks announced an increase of 0.25% for the third time within the year. Monthly increase of 1.4%, fixed deposit increased by 46% year-on-year, Hong Kong dollar fixed-term 丨 Hong Kong banks are scrambling for money, and only 3 experts: it is time to do long-term fixed deposit real estate survey: 65% of respondents choose to stay put and some prefer to fixed deposit

Source: hk1

All news articles on 2023-02-01

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