Hong Kong Monetary Authority Sets 4% Interest Rate for Silver Bond Series 2025
Alvin Lang Sep 01, 2025 08:56
The Hong Kong Monetary Authority announced a 4% interest rate for the sixth interest payment of the Silver Bond Series due 2025, surpassing the floating rate.
The Hong Kong Monetary Authority (HKMA) has announced the interest rate for the sixth interest payment of the Silver Bond Series due 2025, which is set at 4.00% per annum. This rate was determined as the higher of the prevailing floating and fixed rates, as outlined in the Issue Circular from August 9, 2022.
Details of the Interest Rate Decision
According to the HKMA, the sixth interest payment is scheduled for September 15, 2025. The decision to set the interest rate at 4.00% was based on a comparison between the floating and fixed rates, with the latter being higher. The floating rate was calculated at +1.52%, influenced by the year-on-year rates of change in the Composite Consumer Price Index, while the fixed rate was set at +4.00%.
Adjustments and Scheduling
The original payment date was set for September 14, 2025, which falls on a Sunday. As per the Issue Circular, this necessitated a rescheduling to the next business day, which is September 15, 2025. The interest will accrue until the new payment date, ensuring holders of the Silver Bond Series receive their due payments in accordance with the revised schedule.
Context and Implications
This announcement comes as part of the Retail Bond Issuance Programme under the Government Bond Programme. The HKMA's decision reflects the ongoing economic conditions and aims to provide a stable return for bondholders amidst varying inflation rates. The fixed rate's superiority over the floating rate in this case suggests a strategic choice to offer consistent returns despite fluctuating inflation, as evidenced by the Composite Consumer Price Index changes throughout 2025.
For further details, the official announcement by the Hong Kong Monetary Authority can be accessed on their website.
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