Salient to Investors:
The IMF said:
- the sharp run-up in house prices raises the risk of an abrupt decline.
- the property sector is the main domestic economic risk, though the odds of a slump that has major economic and financial consequences is fairly low near term.
- economic growth may rebound to 3 percent in 2013 versus 1.25 percent in 2012, while inflation may average 3.75 percent in 2012 and 3.5 percent in 2013.
Steven Barnett at the IMF said in the long run, it’s about increasing supply. Barnett said the dollar peg is still the best arrangement and is transparent and credible, and Hong Kong has flexible markets, robust and proactive financial oversight, and a very healthy fiscal position.
Read the full article at http://www.bloomberg.com/news/2012-12-12/hong-kong-at-risk-of-property-price-correction-imf-says.html