The interest rate increase at the first U.S. interest rate meeting this year narrowed to the usual standard of 0.25%. This cycle of interest rate hikes has increased from 8 times since last year to 4.5%. The interest rate has shown a monthly downward trend, and the rate of increase is expected to be only about 0.5% from the peak of the US interest rate. It is expected that the rate hike cycle will end in or before May this year, and the interest rate is expected to peak in or before May.
After the U.S. interest rate hike cycle is over, the interest rate will run rampant for a period of time until the inflation rate gradually falls back to the target level of 2%. However, the local area is concerned about the impact on the economy after a large interest rate hike. It is believed that economic data will determine the trend of the U.S. interest rate. If the economic trend continues Turning weak, the U.S. interest rate may accelerate to turn around and fall within the year.
In terms of Hong Kong interest rates, Wang Meifeng pointed out that the iconic HSBC Bank announced that it will keep the prime rate (P) unchanged at 5.625%, bringing good news to the market. It is expected that other banks will follow suit, and the market interest rate will remain mainly at 3.375% to the 3.475% level.
Wang Meifeng explained that the one-month HIBOR related to real estate mortgages has fallen from a high of more than 5% to 2.53% after the year-end factors. As the US interest rate hike period is approaching, the U.S. dollar HIBOR has risen. Instead of rising, it fell, and fell back to the U.S. interest rate, which was significantly widened by 2%, reflecting the abundance of Hong Kong dollar funds. It is believed that the recent financial and investment environment has attracted funds to stay in Hong Kong, which has widened the gap between the interbank rate and the prime rate to 3.1%. The prime interest rate P remains unchanged, so that there is no need for banks to further increase deposit and loan interest rates.
The market has already priced in the impact of the rate hike
Wang Meifeng continued to point out that the U.S. interest rate hike cycle is coming to an end, and whether the adjustment of Hong Kong interest rates has been completed early still depends on the future trend of interbank interest rates, capital flows and levels; this year's market focus on "returning to normal" has further improved the local economy and investment environment. Market funds remain abundant, and it is not ruled out that the cycle of interest rate hikes in Hong Kong may have ended. I believe that even if it is necessary to increase P within this year, it will only be added once more.
Wang Meifeng said that Hong Kong has benefited from factors such as the gradual lifting of epidemic prevention measures, the resumption of customs clearance, and interest rates will peak. The market sentiment has picked up, and the property market has increased significantly. Maintaining the current level will bring further good news to the market; in fact, Hong Kong banks have lagged behind the U.S. interest rate increase in this cycle of interest rate hikes (the U.S. rate hike is 4.5%, Hong Kong P plus 0.625%), so the outlook for the property market is positive. , I believe the market has fully digested the impact of the rate hike.
U.S. interest rate hike｜Meridian: Bank of Hong Kong maintains the best interest rate unchanged, which has positive support for the property market｜Bank of China (Hong Kong) Chen Weiquan: The Fed will raise interest rates to 5%, and the U.S. interest rate hike will narrow, and Hong Kong Bank will maintain the best interest rate. Change agent: There is positive news for the property market, and the US will raise interest rates｜Star Valley: Hong Kong banks may not follow the Fed’s increase in P, and the US interest rate hike cycle is expected to come to an end