Hong Kong Raises Silver Bond Rate to Attractive 4.25% Amid Fed Expectations

Hong Kong's government has raised the coupon rate for its Silver Bonds to 4.25% for the latest batch, which will go on sale this month with a guaranteed annual return that is significantly higher than current bank fixed-deposit products.

The 11th batch of Silver Bonds will be available from August 21 until September 4, and will be issued on September 15, just before the US Federal Reserve's next interest rate decision. The government has announced that up to HK$50 billion (US$6.4 billion) of these bonds will be put on sale.

Silver Bonds are specifically designed for senior citizens, offering a fixed return linked to Hong Kong's inflation rate or a minimum fixed rate, whichever is higher. Each board lot costs HK$10,000, with a maximum allocation per person of HK$1 million. Interest is paid every six months.