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HSBC Holdings (0005.HK), said on Thursday it raised its best lending rate in Hong Kong by 12.5 basis points to 5.125% effective Sept. 23 after the city’s central bank raised the base rate charged through its overnight discount window by 75 basis points.

The Hong Kong Monetary Authority earlier on Thursday raised the base rate charged through its overnight discount to 3.50% from 2.75%.

Hong Kong tracks U.S. interest rate moves because its currency is pegged to the U.S. dollar, although local banks have some leeway to lag U.S. moves when setting prime rates.