HONG KONG banks have followed this week's rise in United States interest rates, pumping up borrowing and saving rates by the same half percentage point. The prime lending rate on which loans are set was increased to 7.75 per cent. But there is some good news for the territory's savers even if the rate of return is still outpaced by the territory's forecast inflation rate of nine per cent. The banks will be passing on the full half a percentage point rise for both short term and long term accounts. This means a 24-hour call notice account will pay three per cent, while a three-month account will earn up to 4.75 per cent. The top rate for one-year deposits will increase to 5.75 per cent. The new borrowing and savings rates will apply from Monday. Chairman of the Hong Kong Association of Banks, Paul Selway-Swift, said Hong Kong had no choice but to follow the US Federal Reserve Board move. The rise means that the average family buying a $2.5 million home over 20 years will have to find an extra $809 a month in payments, or prime plus 1.75 per cent. Those on larger loans for luxury homes will generally be even harder hit because they pay prime plus 2.25 per cent. A home-buyer repaying a $10 million mortgage over 10 years will have to find another $3,263 a month. But analysts believe it would take more than a 50 basis points rise in rates to rock the local property market. They claim the banks' tightened mortgage lending and the Government's package of measures to dampen speculation had a bigger impact. ''I do not think the increase will have a large impact on those with mortgages. Rather, as higher rates cool down the property market, home buyers will benefit from lower property prices,'' said Alexander Au, managing director and chief executive of the Hang Seng Bank. Michael Clarke, managing director at real estate consultants Chung Sen Surveyors, said the rise was more likely to have a psychological impact on the market. ''We have just seen some signs of recovery in the property market. The increase in mortgage rates might make people hold a week or two to see what might happen,'' he said. The price of an average home has fallen by 15 to 20 per cent since March and activity has halved. Analysts argue that while rising interest rates do not help the property market, negative real interest rates still make it more attractive to bank your money in real estate. The banks announced their higher rates within an hour of the mid-afternoon meeting of the Hong Kong Association of Banks, which recommended the savings rate. The rises had been widely forecast after the decision by the United States Federal Reserve on Tuesday. A poll in the South China Morning Post the following day found the territory's top 10 brokerages correct in predicting a 50 basis points rise. The Hong Kong dollar exchange rate is pegged to the US dollar and the interest rate differential must be minimised to maintain currency stability. By yesterday, the stockmarket had discounted the impact of the rise on local stocks after earlier in the week welcoming the move from Washington. Crosby Securities dealing director Willie Chau Wing-hung said: ''The rise was fully expected. To be honest there were other worries in the market keeping investors busy.'' Falls in bond and equity prices overnight on Thursday in the United States caused investors to sell down Hong Kong stocks. DBS research director Percy Au-young said: ''Next week I expect the market to trade sideways. This rate rise was completely discounted.'' Economists believe the overall impact of the rate rise will be to reduce private consumption and encourage people to save more. WI Carr economist Gilbert Choy is forecasting a slowdown in retail spending and lower volumes in the stockmarket. ''Any spectacular increase in the stockmarket will be driven by the inflow of foreign funds,'' he said. Economists do not expect any let up in the territory's high rates of inflation.