Hong Kong and Macau Rate Hikes Match Fed’s Action
March 23, 2023
Domestic monetary policy is subordinated to fixed exchange rate regimes at the Hong Kong Monetary Authority and the Macau Monetary Authority. The Hong Kong dollar has been pegged to the U.S. currencies since 1983, and Macau links its currency to Hong Kong’s. As a result, whenever the Federal Reserve changes its interest rate, the rates in Hong Kong and Macau move automatically in kind. Both rates now become 5.25%, 25 basis points above the Fed’s new target ceiling, and thiese are the highest rates in 15 years.
Copyright 2023, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
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