One-month interbank offered rate fell to 0.76 cents, BOC: Property investment still needs to observe changes in interest rate trends

Hong Kong Interbank Offered Rate (HIBOR) continues to decline, with the one-month HIBOR related to mortgage loans dropping to about 0.76% yesterday (21st), marking a nearly three-year low, while the three-month HIBOR also fell to about 1.81%. Zhou Guochang, General Manager of Personal Banking Products at BOC Hong Kong, expects that in the coming months, the one to three-month Hong Kong dollar interbank rates will remain between 2% and 3%, with actual trends influenced by factors such as Hong Kong dollar demand, US dollar movements, and the pace and extent of US interest rate cuts.

Zhou Guochang anticipates that the low-interest environment will persist for some time, and deposit rates will fluctuate around 2%. He pointed out that it is still necessary to observe whether HIBOR will fluctuate in the long term and advised clients interested in purchasing property to continue monitoring interest rate trends when making buying decisions. In the long term, it is also essential to watch the trends of the best lending rate (P) and changes in the capped interest rate (P-Cap).

Zhou Guochang believes that the primary factor influencing long-term interest rate trends is the expectation of US interest rate cuts in the second half of the year. The market anticipates that the US will only begin to cut rates in September, with two rate cuts expected this year, which is slower and fewer than previously anticipated.

He also expects moderate growth in Hong Kong's property market this year, with no significant fluctuations in property prices. He believes that new developments will remain the main driving force in Hong Kong's property market, and factors such as the speed and pricing of developers' launches will directly impact whether clients enter the market