Chen Maobo: Hong Kong follows the US interest rate hike
The US Federal Reserve held a meeting on interest rates this week, and the market is expected to raise interest rates by another 0.25 per cent. The Financial Secretary, Mr Chan Maobo, also raised the risk of interest rate hikes on the blog. It refers to the trend of Hong Kong’s interest rate in the past few months. The opportunity for Hong Kong banks to raise the best interest rate is extremely high and will be the first increase since 2006. The ultra-low interest rate environment of more than 10 years is about to end, and with many unfavorable uncertainties in the future, he warned that the property market has a downside risk and the public should do risk management.
Warning that the property market has a downside risk
Chen Maobo said that with the recent two interest rate hikes in the United States, the interbank interest rate (Hibor) has risen a lot. Many people in the building have already felt the additional burden of raising interest rates. Earlier, many banks in Hong Kong successively raised the interest rate on new mortgages, and the burden on buildings will increase.
He said that this year the US domestic economy as a whole is improving, and last year, through tax reforms, many funds were returned to the local area, the US dollar exchange rate strengthened, and emerging markets faced the pressure of capital investment. Some countries’ exchange rates fell sharply, and the economy faced severe conditions. challenge. In addition, the Sino-US trade war that is heating up is estimated to be entangled for a long time.
Refers to trade wars affecting corporate investment intentions
Although the value of the re-exports affected by Hong Kong at this stage only accounts for 3.5% of the total value of exports, the risk of direct impact on the level of trade in goods is generally controllable; however, corporate investment intentions, confidence in the prospects and financial market sentiment are mostly affected. At present, mainland companies account for about two-thirds of the Hong Kong stock market, accounting for about 70% of the total daily turnover. If the A-share market is significantly reduced, Hong Kong stocks will not be spared. If the stock market continues to slump, it may hit the public’s consumer sentiment and purchasing power, affecting the market atmosphere and dragging down economic performance.
On the property market, Chen Maobo also pointed out that the current property prices in Hong Kong have significantly exceeded the affordability of the public. According to some market figures, the property market has shown signs of cooling in the past few weeks, and the transaction volume has fallen. The supply side is the potential first-hand residential supply for the next three to four years. Maintain approximately 93,000 people, including approximately 19,000 ready-to-sell or budget units. In the next five years, the annual completion will be 21,000 units, an increase of about 50% over the past five years. Coupled with the vacant tax measures introduced by the government later, the new completion units will be sent to the market more effectively. The risk of the downturn in the future property market cannot be ignored. The public needs to carefully manage risks.