News analysis
Amid soaring inflation, mainland China and Hong Kong central banks chose to respond in opposing ways to the U.S. Federal Reserve’s aggressive interest rate hikes, with China loosening its monetary policy, and Hong Kong raising interest rates.
On June 15, the Fed raised the primary credit rate by 75 basis points, the largest increase in 28 years. The day after, the Bank of England raised its benchmark interest rate by 25 basis points, the fifth time in 2022.
Following the Fed’s move, the Hong Kong Monetary Authority (HKMA), the city’s central bank, also adjusted its base rate upwards by 75 basis points….