HKMA Reports Slight Increase in Composite Interest Rate for December 2024

The Hong Kong Financial Authority (HKMA) has revealed a modest enhance 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 price of two.20%, as reported by the HKMA.

Components Influencing the Charge Enhance

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 common value of funds for banks, encompassing numerous interest-rate-sensitive liabilities akin to buyer deposits and negotiable certificates of deposit.

Historic Context and Calculation Methodology

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

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

Entry to Historic Knowledge

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 supplies beneficial insights into the traits and shifts within the banking sector’s curiosity prices over time.

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

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