Macau (MNA) – Lionel Leong Vai Tac, the Secretary for Economy and Finance in Macau, told media on Thursday that while the likelihood of an immediate mortgage interest rate increase happening was unlikely it might happen by September or by the end of the year.
“It depends upon the situation at the end of the year. In fact, spreads between the Hong Kong dollar and the US dollar have started to widen, almost to 2 per cent at the current moment. If you ask me when this will narrow, it would entirely depend upon the financial markets.”
Mr Leong advised young homebuyers to pay attention to monitor the increase in interest rates.
The Secretary explained that mortgage interest rates are likely to increase as bigger enterprises were less likely to use the interbank offered rate as a tool to calculate interest rates.
The Monetary Authority of Macau (AMCM) had just announced on Thursday that they had increased the interest rate by 25 basis points to 2.25 per cent to match the base rate move made by Hong Kong to match the rise of interest rates in the United States.
Both the pataca and the Hong Kong dollar are currently pegged to the US dollar.
As with previous announcements, the Authority warned that the gradual upward adjustment of mortgage interest rates would likely increase the financial burden of mortgages, and that property buyers should ‘prudently assess their repayment ability.’