The composite interest rate nudged up from 3.05% in August to 3.06% in September, the Monetary Authority says. This followed a fall of six basis points in the composite interest rate in August.

The one basis-point increase in the average cost of funds in September was attributable to the mild rise of short-term interbank rates.

The composite interest rate has grown by 282 basis points since the current up-cycle of US interest rates started in mid-2004. Hong Kong banks' best lending rates have risen between 300 and 325 basis points.

During September, the Hong Kong Interbank Offered Rate with maturity of less than one month rose by 2 to 14 basis points, while those for funds with maturity of over one month dropped by 7 to 16 basis points.