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Old 29-04-2018, 11:57 AM   #1510
tamago_
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this pdf dated 5 apr, already outdated, latest is 2.08% for HKD for 12 months.

HKD peg likely to break in near future, once break, rate will surge.
Actually, just to confirm understanding, if the peg breaks, HKD will depreciate to below 7.85 (8-something), which should relieve the pressure for it to follow US in raising rates. Logical investors are now selling HKD to buy USD to get better USD FD interest rates, and HKMA has to lap up the excess HKD on the market by paying out of its USD reserves.

So, once it breaks the peg, the interest rate can continue to stay low, which is needed for them to keep inflation from getting out of control (inflation there is about 4%+ even with 1%+ overnight in part due to property contributing 10%-12% a year).

Last edited by tamago_; 30-04-2018 at 01:07 PM..
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