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

The Macau Monetary Authority implemented a 25 basis point reduction in its base rate, adjusting it to 4.25% on October 30, 2025. This decision aligned with the Hong Kong Monetary Authority (HKMA)'s action, following the US Federal Reserve's interest rate cut. This marks the second rate reduction in Macau this year, setting borrowing costs at their lowest since November 2022. Despite the decrease, Macau is experiencing accelerated inflation and robust economic growth. Recent statistics indicate that Macau’s annual inflation rate hit 0.47% in September, the fastest pace observed in eight months. Concurrently, the unemployment rate was at 2.0% in August, a peak not seen since March 2024. Conversely, the GDP demonstrated significant growth, increasing by 5.1% year-on-year in Q2 2025, marking the most substantial expansion since Q2 2024, and recovering from a 1.3% contraction reported in Q1.