Liquidity conditions in Hong Kong resumed tightening this week with a key money-market rate climbing above a level that some analysts say may stifle a nascent economic recovery.
The benchmark one-month Hong Kong Interbank Offered Rate — or Hibor — jumped above the closely watched threshold of 3% Wednesday, reaching the highest since May. If the gauge sustains above that level it could have a negative impact on the economy as investors would become more cautious, and borrowing demand would fall, Morgan Stanley analysts wrote in a note last week.
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