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Goldman to study China, Hong Kong assets for bubbles
19 Jan 2010, 0338 hrs , Bloomberg
HONG KONG: Real estate prices in China, Singapore and Hong Kong need monitoring for signs of bubbles forming as Asia continues to grow rapidly
this year, said Fred Hu, Goldman Sachs Group’s chairman of Greater China.
Property prices in 70 cities in China rose at the fastestpace in 18 months in December and new bank loans reached a record $1.3 trillion in the first 11 months of 2009. Hong Kong home prices are at the highest in almost 12 years, while in Singapore, a record number of private homes were sold last year.
“I would be very skeptical about this kind of pace,” Hu said at a conference in Taipei, referring to real estate prices in Singapore and Hong Kong. He also warned of inflationary pressures in China, and said that China and India would lead economic growth.
China’s economy is overheating as asset bubbles and inflation pressures build, posing a “major risk” to global growth, the World Economic Forum said January 14.
China’s central bank on January 12 moved to curb lending by increasing the proportion of deposits banks must set aside as reserves.
“China’s property market has a bigger bubble than the stock market,” said Li Jun, a strategist at Central China Securities Holdings in Shanghai. “It’s pretty hard to avoid an asset bubble when banking loans had a big jump last year.”
19 Jan 2010, 0338 hrs , Bloomberg
HONG KONG: Real estate prices in China, Singapore and Hong Kong need monitoring for signs of bubbles forming as Asia continues to grow rapidly
this year, said Fred Hu, Goldman Sachs Group’s chairman of Greater China.
Property prices in 70 cities in China rose at the fastestpace in 18 months in December and new bank loans reached a record $1.3 trillion in the first 11 months of 2009. Hong Kong home prices are at the highest in almost 12 years, while in Singapore, a record number of private homes were sold last year.
“I would be very skeptical about this kind of pace,” Hu said at a conference in Taipei, referring to real estate prices in Singapore and Hong Kong. He also warned of inflationary pressures in China, and said that China and India would lead economic growth.
China’s economy is overheating as asset bubbles and inflation pressures build, posing a “major risk” to global growth, the World Economic Forum said January 14.
China’s central bank on January 12 moved to curb lending by increasing the proportion of deposits banks must set aside as reserves.
“China’s property market has a bigger bubble than the stock market,” said Li Jun, a strategist at Central China Securities Holdings in Shanghai. “It’s pretty hard to avoid an asset bubble when banking loans had a big jump last year.”
