Hong Kong raises base rate after Fed, sees potential outflow

Hong Kong

THE Hong Kong Monetary Authority (HKMA) raised its base rate for the first time in nine years, following the US Federal Reserve's lead overnight, and flagged the risk of rising capital outflows from the city.

Hong Kong's key rate was raised to 0.75 per cent on Thursday, from 0.5 per cent, HKMA said. Because Hong Kong's currency is pegged to the US dollar, the city's monetary policy typically moves in line with the Fed.