HKMA holds base interest rate at 4%, following Fed as war inflation worries persist
‘We’re going to have to wait and see,’ Fed chairman Jerome Powell says after hosting his last FOMC meeting
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The city’s base rate would stay at 4 per cent, the Hong Kong Monetary Authority (HKMA) said on Thursday, hours after the US Federal Reserve kept its target rate in the range of 3.5 to 3.75 per cent following the third meeting of the Federal Open Market Committee (FOMC) this year.
“We’re going to have to wait and see,” Fed chairman Jerome Powell said in a media briefing after he hosted his last FOMC meeting before his term ends on May 15.AdvertisementHe noted that while policymakers were not ready to signal the possibility of rate hikes at this week’s meeting, the centre was moving “towards a more neutral place” where an increase in borrowing costs would be given equal weight in policy guidance to a cut.
Powell also said that after his chairmanship ended, he would remain on the Fed board, acting as a central bank governor, citing President Donald Trump’s legal battle against him as his reason for staying.Advertisement“I had long planned to be retiring,” Powell said. “The things that have happened really in the last three months have, I think, left me no choice but to stay until I see them through at least that long.”
The Fed’s decision was widely expected, with 100 per cent of traders forecasting no change, according to CME FedWatch data based on Fed funds futures contracts on Wednesday.
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