FX.co ★ Macau Cuts Base Rate by 25Bps After Fed Decision

On December 11, 2025, the Macau Monetary Authority decided to reduce its base rate by 25 basis points, bringing it down to 4%. This move came in alignment with the Hong Kong Monetary Authority's actions, following a recent interest rate cut by the US Federal Reserve. This marks the third reduction of the year for Macau, aligning borrowing costs to their lowest since October 2022. The decision was taken against a backdrop of improving employment figures, with unemployment dropping to 1.7% in October, the lowest rate recorded since January. Concurrently, Macau's GDP experienced a robust year-on-year growth of 8% in the third quarter of 2025, marking the strongest growth since the first quarter of 2024. Nevertheless, the annual inflation rate surged to 0.6% in October, reaching its fastest increase in 14 months. Under the linked exchange rate system, Macau's base rate aligns with Hong Kong’s, which is generally set 50 basis points above the lower threshold of the target range for the US federal funds rate.