Financial Regulatory Forum

    By Lee Chyen Yee and Langi Chiang
    HONG KONG/BEIJING, Jan 14 (Reuters) – China is determined to
curb sharp rises in property prices to prevent asset bubbles,
deploying a combination of credit tightening measures, increasing
supply of affordable housing and verbal suasion.  (more…)

By Langi Chiang and Ken Wills

BEIJING, Jan 13 (Reuters) – China renewed its vow to curb runaway property prices and keep a watch on excessive lending, while investors rushed to cut exposure to risk on Wednesday, a day after the central bank tightened bank reserve requirements.

Concerns a bubble was forming in China’s hot property market was one of the reasons why policymakers have repeatedly drained excess cash from the financial system and tried to cool off borrowing, and on Tuesday raised the amount banks must keep in reserve by a half percentage point.

Shanghai’s composite index fell 3 percent and led Asian equities lower, with investors caught off guard by how quickly the central bank acted. Banks and property developers were especially hard hit by fears borrowing costs in China’s booming economy would rise.