Hong Kong keeps base rate steady at 4.75% as monetary policy takes a breather after 3 cuts

Hong Kong’s monetary authority kept its key interest rate unchanged in lockstep with the US Federal Reserve, taking a breather after last year’s three cuts, in the first monetary policy decision of 2025.

The Hong Kong Monetary Authority (HKMA) maintained its base rate at 4.75 per cent on Thursday, in line with market expectations. Hours earlier, the Fed left its target rate in the range of 4.25 to 4.5 per cent, following the first Federal Open Market Committee (FOMC) meeting of the year.

The HKMA last cut the city’s base rate by a quarter point to 4.75 per cent in December, the lowest level in two years.

The Fed’s decision was widely expected, as 97 per cent of traders anticipated no change to the interest rate, according to data compiled by the CME Group, based on Fed fund futures contracts on Tuesday.

“With our policy stance significantly less restrictive than it had been, and the economy remaining strong, we do not need to be in a hurry to adjust our policy stance”, Fed chairman Jerome Powell said after the FOMC meeting.