Adjustment of the Base Rate

The Hong Kong Monetary Authority (HKMA) announced today (Thursday) that the Base Rate is adjusted downward to 1.5% with immediate effect according to a new pre-set formula announced on 8 October 2008 and the decision of the US Federal Reserve on 29 October (US time) where the US federal funds target rate was reduced by 50 basis points.

The Base Rate is the interest rate forming the foundation upon which the Discount Rates for repurchase-agreement transactions through the Discount Window are computed. According to the new formula announced on 8 October 2008, the Base Rate is set at 50 basis points above the prevailing US federal funds target rate.

For further enquiries, please contact:
Thomas Chan, Senior Manager (Press), at 2878 1480 or
Hing-fung Wong, Manager (Press), at 2878 1802

Hong Kong Monetary Authority
30 October 2008