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The Hong Kong Monetary Authority set the Base Rate at 4.25% with immediate effect on 17 September, according to a notice issued on its behalf by the Hong Kong government. The authority said it followed a 25-basis-point upward adjustment to the US federal funds target range the previous day.
Under the preset formula, the Base Rate is the higher of 50 basis points above the lower end of the prevailing US target range or the average of five-day moving averages for overnight and one-month Hong Kong interbank offered rates. Those measures stood at 4.25% and 2.50%, respectively, so the authority set the rate at 4.25%.