Hong Kong central bank raises interest rate after Fed hike

HONG KONG – The Hong Kong Monetary Authority (HKMA) on Thursday raised its base rate charged through the overnight discount window by 75 basis points to 3.5 percent, hours after the U.S. Federal Reserve delivered a rate hike of the same margin.

Hong Kong’s monetary policy moves in lock-step with the United States as the city’s currency is pegged to the greenback in a tight range of 7.75-7.85 per dollar.

The Fed delivered its third straight rate increase of 75 basis points on Wednesday and signaled borrowing costs would keep rising, underscoring the U.S. central bank’s resolve not to let up in its battle to contain inflation.