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US Federal Reservei

Founded in 1913, the Federal Reserve is the central banking system for the United States.

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With the Fed expected to start cutting rates before the end of the year, margins for lenders will narrow, potentially exposing threats in other areas. Hong Kong’s banks have made provisions and shored up balance sheets to ward off China property risk

  • High-profile economist and former State Council researcher warns that potential US capital injections in China, following any Fed rate cuts, might be tumultuous for already-battered markets
  • China is at a financial disadvantage and in ‘a state of being contained, suppressed and harvested’, Chen Wenling says

China has the world’s largest foreign exchange reserves, but some have argued Beijing needs to reduce its size, while others believe having a sizeable holding remains important.

Of the 30 cities monitored in the Savills World Prime Residential Index, 17 will see price declines, with Hong Kong projected to see the highest drop of up to 10 per cent and as much as 3.9 per cent in Singapore.

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Property deals in Hong Kong surged in January to their highest since August on stepped-up buying amid expectations of stable interest rates and hopes that a government residency scheme will draw more investments into the sector.

The banks’ decisions followed the Hong Kong Monetary Authority (HKMA), which left the city’s base rate at 5.75 per cent hours after the Fed kept its target range unchanged in its first policy move of the year.

The precious metal rallied 13 per cent last year, touching a record in early December, on the back of economic and political uncertainty, geopolitical tensions.

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While a number of factors beyond Hong Kong’s borders are affecting its property market, another price war brought on by new residential projects will also impact any recovery, says JLL Chairman Joseph Tsang.

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Analysts and traders are divided over whether the Fed will cut rates in March, or whether a move later in the year would make more sense.

Any signal Fed’s Chair Jerome Powell may choose to send is of critical importance. It all comes down to how Powell and his colleagues have been reading the recent spate of economic data.

China’s central bank announced on Wednesday that the reserve requirement ratio for commercial banks will be reduced by 50 basis points from February 5, but analysts are expecting more supportive measures.

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The Fed will lower rates starting in March for a total of four times this year and inflation will hit the US central bank’s 2 per cent target, according to Joshua Schiffrin, Goldman’s global head of trading strategy.

From Indonesia to India, the world’s most populous democracies will be heading to the polls in Asia this year, a region which has traditionally been the largest gold consumer.

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Donald Trump’s surprise victory in the 2016 presidential election delivered a shock to financial markets. If he manages to secure a second one, traders will – if anything – be far more prepared.

Investment in Hong Kong property fell by 28 per cent to HK$37 billion (US$4.73 billion) last year, its lowest level since the 2008 financial crisis, but is expected to rise to HK$50 billion in 2024, Colliers says.

Hong Kong’s decade-long property bull run, stopped in its tracks during the pandemic, plunged into negative territory after the local monetary authority raised interest rates in lockstep with the US Federal Reserve.

The developers of smaller residential projects in Hong Kong are hastening sales by offering discounts before the Lunar New Year holiday, with the aim of increasing their market share before larger projects are launched later in the year.