Dear HKMA: Mandate Banks to Use the Discount Window

I wrote in a policy memo in December 2022 that the HKMA (Hong Kong’s central bank) should regularly mandate random banks to use the discount window (DW). This would prevent fluctuations in interbank borrowing costs, which hurts both mortgage borrowers and banks.

Download the full paper here: https://johnthwong.github.io/pdf/paper_dw.pdf

When HIBOR (red) Breaches the Base Rate (blue)