Core Viewpoint - The Hong Kong Monetary Authority (HKMA) has intervened for the seventh time to buy Hong Kong dollars as the currency continues to trigger the "weak side convertibility guarantee," leading to a decrease in the banking system's surplus to HKD 82.552 billion [1] Group 1: Monetary Policy and Interest Rates - The recent interventions by HKMA have caused the banking system's surplus to decline, resulting in fluctuations in the Hong Kong Interbank Offered Rate (HIBOR) [1] - HIBOR has been rising recently, with the one-month HIBOR reported at 1.03%, and it is expected to challenge the 1.5% level [1] - The Federal Reserve may lower interest rates for the first time in the fourth quarter, which could lead to capital inflows into the Hong Kong market, alleviating upward pressure on HIBOR [1] Group 2: Banking Strategies - Following the passage of the "Big and Beautiful" bill in the U.S., there is speculation that some funds may flow into the Asia-Pacific markets, prompting Hong Kong banks to potentially lower their prime rates based on their commercial strategies [1] - HSBC announced that it would maintain its prime rate unchanged, despite having lowered it three times last year at a pace and magnitude exceeding market expectations [1] - Currently, with HIBOR at 1%, the effective interest rate for housing loans calculated at "H+1.3%" results in a rate of 2.33%, which remains 1.17% below the capped interest rate of 3.5% [1]

Group 1 - The Mortgage Market Index (MMI) for May reported a significant drop to 2.8%, a decrease of 74 basis points, marking a 31-month low [1] - Over 95% of new mortgage clients opted for the H mortgage plan in May, influenced by the Hong Kong Monetary Authority's market interventions, which increased the banking system's surplus to HKD 174 billion [1] - The average one-month HIBOR fell sharply to 1.47% in May from 3.65% in April, contributing to the decline in MMI and easing the mortgage burden for property buyers in Hong Kong [1] Group 2 - The latest U.S. Consumer Price Index (CPI) for May was reported at 2.4%, slightly up from 2.3% in April, while the unemployment rate remained stable at 4.2% [2] - The impact of tariffs on inflation is still under observation, leading to expectations that the Federal Reserve will maintain its current interest rates for the time being [2] - There is a belief that if inflation remains manageable, there may be one opportunity for a rate cut in the second half of the year [2]