The lending comes amid a climb in borrowing costs in the city, where one-month Hong Kong interbank offered rates have climbed to the highest in around two months. Demand for local assets amid a Chinese stock surge has contributed to the increase in Hibor, as supply of the Hong Kong dollar tightened.
Hong Kong banks borrowed the largest amount of short-term cash in almost five years from authorities, a move pointing to a sudden demand for liquidity.
The Hong Kong Monetary Authority — the city’s de-facto central bank — loaned out HK$4.79 billion ($804 million) through its discount window on Monday, the most since December 2019, according to data compiled by Bloomberg. Lenders have tapped the facility six times in about a month, with the next largest amount HK$3.3 billion.
