The Chief Executive of the HKMA's response on the US Fed FOMC Meeting

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21 Mar 2019

The Chief Executive of the HKMA's response on the US Fed FOMC Meeting

At the meeting on 19-20 March, the US Fed FOMC decided to keep the range of the fed funds target rate unchanged at 2.25%-2.50%. It also announced the conclusion of balance sheet run-off in September this year.

“In the past few months, the Fed has adopted a more moderate tone in its monetary policy stance. The decision of FOMC meeting last night suggests that the Fed will slow down the pace of hiking interest rates and end balance sheet run-off in September. However, as interest rate differentials between HKD and USD remain, there are still incentives for funds to flow from HKD to USD. Repeated triggering of the weak-side Convertibility Undertaking will lead to reduction of our banking system’s Aggregate Balance, which is an inevitable process for normalization of HKD interest rates. The HKMA will continue to maintain HKD exchange rate stability in accordance with the Linked Exchange Rate System,” said Mr Norman Chan, Chief Executive of the HKMA.

“Uncertainties still remain in Fed’s monetary policy and the global macro-economic and financial environment. The public should stay vigilant to possible risks arising from market volatilities,” Mr Chan added.


Hong Kong Monetary Authority
21 March 2019 

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Last revision date : 21 March 2019