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Mortgage Lending: MMI's latest report 4.17% hit a new high in more than 16 years

AInvestTuesday, Jul 16, 2024 4:21 am ET
1min read

According to the latest Mortgage Interest Rate Index (MMI) data from the Mortgage Interest Rate Conversion Research Department, the MMI, which reflects the actual interest rates that a typical new borrower can obtain, was 4.17% in May 2024, up 1 basis point from the previous month and a new high since October 2007.

Cao Deming, chief executive officer of Mortgage Interest Rate Conversion, said that in May, more than 95% of new mortgage borrowers chose H plan, reflecting the preference of new borrowers to choose H plan. The average monthly interest rate (HIBOR) of banks was 4.34% in May, which made the actual interest rate of H plan and MMI continue to reach the upper limit.

Cao pointed out that the chairman of the Federal Reserve, Jerome Powell, said earlier that the US inflation-related data in the second quarter of this year performed well, increasing the confidence in moving towards the 2% inflation target, and implied that it might not be necessary to wait until the inflation rate fell to 2% before reducing interest rates.

He added that the Federal Reserve had the opportunity to reduce interest rates this year, but he believed that the reduction would be small, and the high-interest environment in Hong Kong would last for some time. The HIBOR today was 4.63%, a new high for the month and more than 10 days above 4%, as HIBOR is expected to continue to trade sideways, the actual interest rate of H plan and MMI will continue to reach the upper limit, and MMI will trade sideways above 4% this year.

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