BORNEO HOUSING AGENCY: Terrace House in Bengkurong (B$190K, Property Chinese Owned) • Industrial Warehouse in Menglait, Gadong for Rent • Shop house in Gadong (Ground Floor) for Rent • Industrial Shops in Bunut for Sale • Land in Jerudong for Sale • Shop house in Kiulap for Sale (44 years lease, approx 5,000.00 per month rental) • Chempaka Terrace House for Rent (3 bedrooms, B$700.00 per month) • Shop house in Kiarong for Sale (B$380.00) • TEL: +6738732975, +6738839007           >>           Fully furnished office space for rent at Regus Brunei. Call +673-886-2879 or go to www.regus.com.bn           >>           Private Company Urgently Need Houses & Flats for Rent in Bandar Seri Begawan, Kindly Contact the ff. nos. for further information: 242-7623/+673 883-9007           >>           HAPPY EID MUBARAK "Wishing you prosperity and peace on this holy occasion of EID MUBARAK"           >>           Man United Edge Past Real Madrid On Penalties In UEFA Super Cup Tune-Up           >>           Malaysia Qualify For AFC U23 Championship After Beating Mongolia           >>           Kompany Gamble Poised To Pay Off For Guardiola And Manchester City           >>           NASA Backs Deep Space Habitat Made With Old ISS Cargo Module           >>           Your Telegram Chats Now Include Disappearing Photos           >>           Barcelona's Gerard Pique Posts Neymar Photo With 'He Stays' Message           >>           Strava's New Premium Perks Will Insure Your Phone While You Ride           >>           Philippe Coutinho's Fate Once Again Depends On What Neymar Does           >>           Wells Fargo Accidentally Leaks 50,000 Clients' Records           >>           Girl, 5, Sent Dozens Of ‘Job Offers’ After Being Fined For Lemonade Stall           >>          





[email protected]



[email protected]



[email protected]



+673 222-0178 [Office Hour]

+673 223-6740 [Fax]


Upcoming Events

Program Peningkatan Personel Kementerian Kebudayaan, Belia dan Sukan dan Jabatan-Jabatan Di Bawahnya
July 24th, 2017 | 08:00 AM

Majlis Pelancaran Filem Komedi Brunei ‘Rina 2’
July 25th, 2017 | 19:45 PM

Majlis Perasmian ‘Fruits of BIMP-EAGA: Culture & Food in Tourism Expo 2017
July 27th, 2017 | 10:15 AM

Prayer Times

The prayer times for Brunei-Muara and Temburong districts. For Tutong add 1 minute and for Belait add 3 minutes.


: 04:43AM


: 04:53AM


: 06:16AM


: 0640:AM


: 12:28PM


: 03:51PM


: 06:37PM


: 07:51PM


The Business Directory



World Business

  Home > World Business

A Sense of Calm Has Descended on China's Markets. Don't Fall for It

Photographer: Fred Dufour/AFP via Getty Images


 July 17th, 2017  |  09:36 AM  |   695 views



A sense of calm has descended on China’s markets after a flurry of activity from financial regulators. While it’s emboldening investors, analysts are waiting for the storm.


Liquidity has come roaring back after a dry spell during April and May, when President Xi Jinping ordered a check of China’s financial system and an intensified focus on deleveraging saw mainland debt and equities sell off. That, coupled with what seems like a lull in Beijing’s regulatory fervor, has sparked a resumption in corporate bond buying and a return to borrowing as speculation takes hold that the worst of the crackdown may be over.


To market watchers from Pacific Investment Management Co. to Australia & New Zealand Banking Group Ltd. and Standard Chartered Plc that’s a concern -- not least because the efforts so far have barely budged leverage levels.


“The market should be more cautious, as such complacency is not what policy makers want to see,” said Ding Shuang, chief China economist at Standard Chartered in Hong Kong. “The government won’t easily give up on deleveraging. It still has a way to go.”


Xi said at a two-day National Financial Work Conference ended Saturday the central bank will play a stronger role in defending against risks, calling for more work on safeguarding the financial system and modernizing its regulatory framework. Authorities will proactively prevent and resolve systemic financial risks, and step up efforts to reduce leverage in the economy, the official Xinhua News Agency reported, citing Xi’s comments at the gathering.


With the economy in recovery mode, China has set its sights on tackling a shadow banking sector that’s flourished amid a wider increase in overall debt. That’s taken the form of clampdowns on everything from wealth-management products and property investing to stock speculation and illegal trading.


Since the start of June, however, the banking regulator has largely been quiet, and the People’s Bank of China has acted to bolster liquidity after aggressively driving up money-market rates at the start of the year.


That doesn’t mean their work is done, and authorities are just assessing their progress, says Gene Frieda, a global strategist at Pimco in London.


Deleveraging hasn’t really begun if China’s end-game is to cut total credit, so it’s likely to ramp up again once the twice-a-decade Communist Party Congress concludes later this year, he said. What’s more, Frieda suggests the market may underestimate Beijing’s intentions.


“If there’s complacency, it’s around having mistaken shadow banking system deleveraging as the end goal, rather than control of total leverage,” he said. “If the latter is the target, then Chinese aggregate credit growth is set to slow more sharply in late 2017, which in turn would potentially unsettle markets globally.”


Meanwhile, market players are focused on the here and now. Government bond yields and money-market rates have fallen from multi-year highs and local firms like Citic Securities Co. and China Merchants Securities Co. were recommending investors buy debt again.


Yields on three-year AAA rated corporate bonds have dropped half a percentage point from a two-year-high reached mid-May, just after the communication from regulators on deleveraging was at its most intense. The borrowing cost was at 4.5 percent on Friday, according to ChinaBond data.


This means the market could be set for a shock, with the next round of moves potentially “more drastic” than anticipated, says David Qu, a market economist at ANZ in Shanghai.


“The market appears to be quite confident that it could force policy makers to ease when there’s volatility,” he said. “This isn’t normal and I’m sure the government has noticed this inclination.”


Some seem to have registered that possibility and are preparing for an uptick in interest rates. Chinese companies are picking up the pace of bond issuance, which may indicate they are locking in lower borrowing costs while they still can.


Small cap stocks slumped last week, while shares in large companies surged, suggesting investors may have been shifting to safer bets on concern about renewed deleveraging zeal, according to KGI Securities Co. The mainland market -- which copped the brunt of the selloff in April and May as local traders shifted to offshore Chinese equities -- missed out on a rally last week as the Hang Seng China Enterprises Index jumped the most since November.


Mindful of the reaction to the first round of deleveraging, the authorities may well try and be more sensitive going forward, says Song Yu, chief China economist at Beijing Gao Hua Securities Co., Goldman Sachs Group Inc.’s mainland joint venture partner.


“For the rest of this year, the government will put its foot on and off the brake as needed when it comes to credit, but they probably won’t push it down as far as they did in the first quarter,” he said. “Policy makers will offer an amount of liquidity that’s just enough to maintain healthy growth, but they definitely won’t pump in more gas to boost borrowing.”



courtesy of BLOOMBERG

by Bloomberg News


If you have any stories or news that you would like to share with the global online community, please feel free to share it with us by contacting us directly at [email protected]


Related News

Eco World Foundation Helps 6,000 Students

 2017-07-24 08:37:31

South China Sea: Vietnam Halts Drilling After 'China Threats'

 2017-07-24 08:49:58

China Nasdaq About To Be Cheaper Than Nasdaq For First Time

 2017-07-24 09:38:00