Core Viewpoint - The Hong Kong interbank offered rate (HIBOR) has been rising, with the one-month HIBOR reaching 2% on August 18, marking a new high since May 8, indicating a shift in the banking system's liquidity and interest rate dynamics [1][2] Group 1: Banking System and HIBOR Trends - The banking system's surplus has decreased from a high of 1,740 million HKD in May to approximately 537 million HKD, nearing levels before the Hong Kong Monetary Authority (HKMA) intervened in early May [1] - The continuous rise in HIBOR over four consecutive working days suggests a tightening liquidity environment, with the actual mortgage rate now at 3.3%, still below the market cap of 3.5% [1][2] - The significant widening of the interest rate differential between Hong Kong and the U.S. has led to increased arbitrage activities, prompting the HKMA to intervene multiple times [1] Group 2: Future Expectations and Implications - The rise in HIBOR is expected to narrow the interest rate differential between Hong Kong and the U.S., reducing the incentive for arbitrage and stabilizing the Hong Kong dollar [2] - Despite the current HIBOR being over 2% lower than U.S. rates, expectations of a potential U.S. rate cut later this year could further influence HIBOR downward, with predictions of a decrease in the best lending rate (P) and capped mortgage rates by 0.25% to 0.5% [2] - Factors such as demand for Hong Kong dollars, arbitrage activities, and seasonal influences will continue to affect HIBOR fluctuations, necessitating borrowers to choose capped mortgage plans to mitigate risks associated with rising rates [2]