Hong Kong Monetary Authority Sets 4% Interest Rate for Silver Bond Series

The Hong Kong Financial Authority (HKMA) has introduced the rate of interest for the fifth curiosity cost of the Silver Bond Sequence due in 2025, as per their newest launch. The choice impacts Subject Quantity 03GB2509R, a part of the Authorities Bond Programme’s Retail Bond Issuance.

Curiosity Charge Particulars

As outlined within the Subject Round dated 9 August 2022, the curiosity cost is scheduled for 14 March 2025. The HKMA declared that the related rate of interest could be decided based mostly on whether or not the prevailing floating fee or fastened fee was increased on 28 February 2025. In keeping with the HKMA, the fastened fee was set at 4.00%, whereas the floating fee was calculated at 1.82%.

Consequently, the fastened fee of 4.00% each year was prioritized, marking it because the relevant rate of interest for the upcoming cost.

Context and Implications

The Silver Bond Sequence is a key element of the Hong Kong Particular Administrative Area Authorities’s technique to supply secure funding alternatives for senior residents. The choice to use the fastened fee displays a cautious method in making certain favorable returns for buyers amidst fluctuating market situations.

Moreover, the floating fee was derived from the year-on-year modifications within the Composite Shopper Worth Index (CPI) for the months main as much as January 2025. The index confirmed different charges: August 2024 at 2.50%, September 2024 at 2.20%, and October to December 2024 at 1.40%, with January 2025 reaching 2.00%. The arithmetic common of those figures resulted within the aforementioned floating fee of 1.82%.

For extra particulars, seek advice from the official announcement by the Hong Kong Financial Authority.

Picture supply: Shutterstock