An International Monetary Fund official said China will avoid an economic hard-landing as government data showed property prices falling in most of the nation’s biggest cities,
“China’s heading for a soft-landing,” Zhu Min, a deputy managing director at the IMF, said at a conference in Hong Kong today, citing strength in investment. Prices of new apartments fell in 45 of 70 cities in February, the statistics bureau said in Beijing yesterday.
Premier Wen Jiabao has prolonged a crackdown on real-estate speculation to reduce the risk of asset-price bubbles and make housing affordable, saying last week that prices remain far from “reasonable.” A government program to build millions of low- cost homes may help to support growth in the world’s second- biggest economy and moderating inflation means policy makers have more room to add stimulus.
Zhu said that inflationary pressures are a long-term challenge for the nation, while investment remains too large as a proportion of gross domestic product.
The Shanghai Composite Index fell 0.5 percent as of 11:09 a.m. local time in the first trading since the property numbers were released.
Adrian Mowat, JPMorgan Chase & Co.’s chief Asian and emerging-market strategist, said March 14 that China is already experiencing “a hard landing,” visible through weakness in car sales and cement and steel production.
Source: Bloomberg