【Hong Kong Dollar Fixed Deposit】Hong Kong dollar 1-year fixed deposit with a maximum interest rate of 2.7%, earning 2.7 million HKD. East Asia Digital Bank competes against the market to fight for long-term funds.

			▲ The first two days of April: eight Hong Kong banks cut time-deposit rates

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Just entering the first week of April, only four banks were unanimously increasing Hong Kong dollar fixed-deposit rates (up by 3 compared with last week’s three). These include today (April 2) Fusion Bank and AirStar Bank, both raising their 1-year rates against the trend; the new rates are all at 2.7%.

In contrast, this week has five banks with cuts and no increases (down from six banks last week). For example, on Thursday alone, six banks were chasing the rate-cut express: Bank of Communications Hong Kong added today and cut tomorrow; BOC International and大众银行 both cut for two consecutive days; CCB Asia reduced rates across the board; Fubon and Chong Hing also cut.

Although interbank rates were broadly trending up ahead of the long holiday, over these two days many Hong Kong banks still raised and then cut. Looking ahead to the market, next week has only three trading days; experts expect the wave of rate cuts to continue. Because President Trump’s military actions against Iran still require another two to three weeks, the market thinks the Middle East may not stop fighting until May. With the industry’s big business plans feared to be forced into a wait-and-see mode, banks offering high deposit rates to attract funds temporarily have too few lending outlets. Only some local numbers banks are “tightening and competing harder” to grab long-term high rates.

Overall for the whole week, 14 Hong Kong banks adjusted their time-deposit rates. Among them, 5 banks cut (CCB Asia’s two consecutive one-week cuts, Fubon, First Commercial, Chong Hing, and U-Land), while 3 banks increased (DBS, Hang Seng’s? Actually 東亞, and Fusion Bank). Another 6 banks both increased and cut (AirStar Bank restored rate hikes today; Industrial and Commercial Bank of China? Actually 工銀, as well as Nanyang, Dah Sing, BOC, and BOC International—after boosting rates, then cut again).

CCB Asia 5.88% + 6.88% ultra-high interest: “turning time into overtime” for a contest

This week has only four trading days, but the high-interest leaderboard across five tenors has been reshuffled: 1 month, 4 months, 1 year, 18 months, and 24 months. This is because Ping An Digital Bank’s 1-month rate at 15 per mille expires at end of March and will not be rolled over; Nanyang’s rates for 1 year, 18 months, and 24 months also are all 2.8 per mille and likewise do not extend after their end-of-month maturity. As for 4 months: after Fubon cut the 4-month rate by 0.1 per mille to 2.35 per mille on Thursday, it lost the “number-one” throne and could not beat DBS’s 2.4 per mille.

On a 1-year basis, Fusion Bank and AirStar Bank increased against the tide before the long holiday to 2.7 per mille, narrowly beating Ping An Digital Bank’s 2.65 per mille to reclaim the top spot—if you’re in a “hedge and park money” camp, you’d earn interest of 27,000 if you put HKD 1 million into a safe deposit.

• Review the long vs short interest rate battles among big and small banks:
• 7-day highest rate: Fusion Bank 21 per mille (new customers exclusive; just extended to end of May)
• 14-day: Fusion Bank 25 per mille (new customers)
• 1 month: HSBC 10 per mille (stock incentive program)
• 2 months: Nanyang 2.15 per mille
• 3 months: CCB Asia 6.88 per mille (only for the first 20% of deposits); another option at 5.88 per mille (just extended to June 30)
• 4 months: DBS 2.4 per mille (replacing Fubon at the top)
• 5 months: Nanyang 2.3 per mille
• Half-year: Ping An Digital Bank (formerly known as PAObank) 2.65 per mille
• 7 months: Dah Sing Finance 2.125 per mille
• 8 months: U-Lend 2.35 per mille (cut 0.05 per mille on Thursday)
• 9 months: AirStar Bank 2.6 per mille (increased 0.05 per mille on Thursday)
• 1 year: Fusion Bank and AirStar Bank 2.7 per mille
• 18 months: Fusion Bank 2.7 per mille
• 2 years: U-Lend 2.25 per mille
• 36 months: Mox 2.3 per mille
• 48 months: Mox 2.3 per mille

Citi expert: Liao Jiahao expects U.S. inflation in the second quarter at 3.6%　Brent oil hits as high as $120

After month-end and quarter-end, interbank rates rebounded sharply on Wednesday, but ahead of the long holiday, on Thursday they rose across the board again. Overnight rate turned from falling to rising to 2.02 per mille; the 1-month interbank rate ended its three-day streak of losses, settling at 1.98 per mille. The banking system’s total settlement balances edged up slightly to 53.8 billion; the HKD exchange rate this morning was provisionally 7.8352 to 7.8386. The U.S. dollar kept sliding below the 100 mark, at 99.956.

The escalation of the conflict between the U.S. and Iran: early Thursday, President Trump said he would still launch a fierce attack on Iran. His remarks of “starting a war rather than calling for a ceasefire” sparked market panic. Oil prices surged: Brent futures rose 5% to $106.15; New York oil futures climbed to $104.19, up 4%.

Citi Bank’s investment strategy and asset allocation head Liao Jiahao said that Brent oil is forecast at $120 for the next three months, but the 6- to 12-month forecast is expected to fall back to $80. For New York oil, the 3-month forecast is $108, while the 6- to 12-month forecast is $74. Meanwhile, the U.S. inflation forecast for Q1 is expected to rise 3.3%; Q2 rises to 3.6%, but Q3 and the end-quarter are expected to ease slightly to 3.1%. For the U.S. Dollar Index, the 3-month forecast is 103.29, and the 6- to 12-month forecast is 100.47. The Federal Reserve may cut rates by a total of 75 basis points this year, with cuts of 25 basis points in June, July, and September.

Hang Seng: the 7-day 5% cut-off date extended again to end of June

In addition, looking only at the four major banks, three of the note-issuing banks are still holding steady on their stance—only Hang Seng extended its original 7-day 5% ending at end-March to end of June.

• Comparing the “fixed-deposit interest rate” offerings of the four major banks:
• 7 days:
  HSBC 7% (only for eligible customers exchanging new funds; branch or phone wealth management), 6% (liquid wealth management promotion)
  Standard Chartered 5% (cut by 2% on Feb 10)
  Bank of China Hong Kong, Hang Seng 5%
• 1 month:
  HSBC 10% (stock incentive program), 3% (exchange for new funds)
  Hang Seng 3% (launched Jan 2; threshold HKD 1 million), 2.5% (threshold HKD 10,000)
  Bank of China 2%
• 3 months:
  HSBC 2.2% (cut by 0.2% on Mar 2)
  Standard Chartered 2.1% (cut by 0.1% on Mar 2)
  Bank of China 2.1% (cut by 0.3% on Feb 4)
  Hang Seng 2% (cut by 0.2% on Mar 16)
• Half-year:
  HSBC 2% (cut by 0.1% on Mar 2)
  Standard Chartered 1.95% (cut by 0.05% on Mar 2)
  Hang Seng 1.9% (cut by 0.2% on Feb 9)
  Bank of China 1.9% (cut by 0.2% on Feb 4)
• 1-year:
  Standard Chartered 2% (cut by 0.2% on Feb 10)

Fusion Bank puts out the full lineup: extend the high rates and extend the 21% offer to end of May

On the other side, this week four digital banks (formerly known as virtual banks) moved in, namely: Fusion Bank launched coordinated offensives—boosting the 1-year term to top the “long-term rates king,” and also extending the 7-day 21 per mille promotion to end of May. In contrast, Ping An Digital Bank and U-Lend cut rates, while AirStar Bank cut yesterday and increased today.

• Long vs short interest rate kings among digital banks:

• 7 days: Fusion Bank 21 per mille (new customers exclusive)

• 14 days: Fusion Bank 25 per mille (new customers)

• 2 months: AirStar Bank 1.3 per mille (up 0.05 per mille on Thursday)

• 3 months: Ping An Digital Bank 2.55 per mille (down 0.1 per mille on Monday)

• 4 months: AirStar Bank 2.2 per mille (up 0.1 per mille on Thursday)

• Half-year: Ping An Digital Bank 2.65 per mille (down 0.1 per mille on Monday)

• 8 months: U-Lend 2.35 per mille (down 0.05 per mille on Thursday)

• 9 months: AirStar Bank 2.6 per mille

• 1-year: Fusion Bank and AirStar Bank 2.7 per mille; Ping An Digital Bank 2.65 per mille (for all-new customers using new funds), Ant Bank 2.5 per mille, U-Lend 2.42 per mille, Ping An Digital Bank 2.4 per mille (existing funds), Mox 2.3 per mille, Zann 2.01 per mille, Li Hui 2 per mille

• 18 months: Fusion Bank 2.7 per mille

• 24 months: U-Lend 2.25 per mille

• 36 months and 48 months: Mox 2.3 per mille

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