HONG KONG, March 23 (Xinhua) -- The Hong Kong Monetary Authority (HKMA) on Thursday announced that it has increased the base rate to 5.25 percent with immediate effect.

This undated photo shows the building of the Hong Kong Monetary Authority. (File photo: IC)

The move followed the U.S. Federal Reserve's increase in the target range of the federal funds rate by 25 basis points.

The HKMA said the financial and monetary markets of Hong Kong continue to operate in a smooth and orderly manner, despite the volatile overseas markets. This is attributed to the resilience that has been built up in the financial market over the years, the sound banking system and the effective operation of the Linked Exchange Rate System.

The HKMA said it will continue to closely monitor market developments and maintain monetary and financial stability.