Central Plains Mortgage: It is expected that Hong Kong's H mortgage will remain rampant at 3.25% for some time

The Zhitong Finance App learned that the Federal Reserve kept interest rates unchanged in line with expectations. HSBC announced that it would keep the best interest rate unchanged at 5%, and Central Plains Mortgage expects other banks to follow suit. Wang Meifeng, managing director of Central Plains Mortgage, pointed out that despite the decline in the US inflation rate, which was just announced in July, due to repeated uncertainties about the situation in the Middle East, the impact of a new round of tariff measures on the energy and supply chain, and the increasing inflationary pressure caused by AI development, whether local inflation will rise again in the future will be a key factor affecting the US market trend.

After the interest rate meeting, the Federal Reserve emphasized that its priority is to deal with inflation and will use interest rates as a tool. Therefore, under concerns about a rebound in inflation, the market expects the US to have a greater chance of raising interest rates once during the year (September at the earliest); however, based on the fact that the Federal Reserve no longer officially provides forward-looking guidance, it is believed that whether or not to raise interest rates during the year mainly depends on future inflation trends and real economic data, so it is not ruled out that the US interest rate will rise slightly from the current neutral level.

Since the US began the interest rate reduction cycle in September 2024, interest rates have been reduced by a total of 1.75%. The current US interest rate (3.5% to 3.75%) is close to the neutral interest rate level, which is conditional to respond to the economic environment, including dealing with inflation trends and minor adjustments in economic data. It is expected that the US interest rate is still mainly within the current neutral level range.

Wang Meifeng, managing director of Central Plains Mortgage, said that the current interest rate reduction cycle in Hong Kong began in September 2024, and the bank accelerated interest rate cut so that the best interest rate P bottomed out at the end of October last year and returned to the lowest level before the interest rate hike; as for interbank interest rate HIBOR, the monthly interest rate related to mortgage loans has mainly been above 2% since this year. It is expected that mainstream H interest rates will continue to run rampant at the 3.25% capped level for some time. Wang Meifeng pointed out that although the market expects that the US may have an opportunity to raise interest rates by about 0.25% once during the year based on a rebound in inflation, it is not necessarily obvious that the initial local interbank interest rate will follow the upward trend. The interest rate trend also depends on the continuous trend of US interest rates and market supply and demand factors. It is expected that banks will not necessarily follow the US interest rate hike P in real time. Hong Kong P is more likely to maintain the current low level during the year.

The shift in US interest rate intentions is expected to rise further: in March, large banks successively launched low interest rate fixed plans. Currently, three large banks are providing low interest rate fixed rates. The relevant fixed interest rate of 2.73% is 0.5% lower than the mainstream H rate 3.25%. Based on the fact that the US interest rate intention has changed from interest rate cuts to rampant interest rates this year, it is possible to raise interest rates once, which means that 3.25% of H interest rate will not fall during the year, making the 2.73% fixed interest rate plan more attractive. Based on market expectations, there is an opportunity for MICE to shift. Also, during the season, it will At the end of the day, it is expected that more mortgage users will grasp the last-minute shuttle bus, causing the number of fixed deposit applications to continue to rise; the latest figure has surpassed 20% in May, rising to an eight-year high of 20.7%. It is expected that in the short term, it will stabilize at more than 20% of the market rate.