HKMA Reports Slight Increase in Composite Interest Rate for December 2024

The Hong Kong Financial Authority (HKMA) has revealed a modest improve within the composite rate of interest, which reached 2.24% by the top of December 2024. This marks an increase of 4 foundation factors from November’s charge of two.20%, as reported by the HKMA.

Elements Influencing the Charge Improve

The uptick within the composite rate of interest primarily displays a rise within the weighted funding value for deposits all through December. The composite rate of interest is a key indicator of the typical value of funds for banks, encompassing varied interest-rate-sensitive liabilities reminiscent of buyer deposits and negotiable certificates of deposit.

Historic Context and Calculation Technique

Information from retail banks, which signify roughly 90% of the whole buyer deposits within the Hong Kong banking sector, are utilized in calculating the composite rate of interest. This charge serves as a median measure of curiosity bills, though it excludes different prices related to mortgage creation, reminiscent of working, credit score, and hedging prices.

Since June 2019, the HKMA has adopted a brand new native “Rate of interest threat within the banking ebook” (IRRBB) framework for calculating the composite rate of interest and weighted deposit charge. Consequently, these figures usually are not instantly comparable with these from earlier intervals.

Entry to Historic Information

For these , historic information on the composite rate of interest from the top of the fourth quarter of 2003 by way of December 2024 is accessible within the HKMA’s Month-to-month Statistical Bulletin. This complete information set gives priceless insights into the traits and shifts within the banking sector’s curiosity prices through the years.

For extra detailed data, please go to the official Hong Kong Financial Authority web site.

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