Hang Seng Bank: Maintaining the forecast of Hong Kong's economic growth of 2.5% this year, short-term Hong Kong dollar interest rates may fluctuate.

The head of the Economic Research Department and Chief Economist at Hang Seng Bank, Xue Junsheng, stated that the Federal Reserve kept its target interest rate unchanged as expected by the market. He believes that the current performance of the US economy is good, but there are many uncertainties in the future, so there is no need to rush to adjust policies. From the speech of Federal Reserve Chairman Powell after the interest rate meeting, it can be seen that trade policies may lead to a slowdown in US consumption and investment, as well as an increase in unemployment rates, but the specific impacts are difficult to estimate. Similarly, related measures may cause a temporary increase in US inflation. The bank believes that the Federal Reserve hopes to determine the trajectory of the US economy and inflation from data in the coming months before deciding on the next steps and timing of action. For Hong Kong, influenced by capital flows, short-term Hong Kong dollar interest rates may fluctuate. If US interest rates trend downwards in the next two years, Hong Kong dollar interest rates are expected to follow suit, which will help maintain economic growth in Hong Kong. The bank maintains its forecast of 2.5% economic growth in Hong Kong this year.