Hong Kong: Adds tax, intensifies housing bubble fight
Hong Kong intensified a yearlong battle to curb surging home prices with additional taxes and higher down payments a day after the IMF warned that asset inflation may derail the city’s economy. Homes sold within six months of purchase will incur a 15% stamp duty, Financial Secretary John Tsang said. Down payments for homes costing HKD12m (USD1.5m) or more will rise to 50%, from 40%. (Bloomberg)
China: ‘Fighting Mode’ on reserves ratios may hurt stocks, bonds
China’s stocks and bonds may fall, and Yuan forwards may advance, as the world’s fastest-growing major economy increases the amount of money that banks must set aside to fight inflation. The reserve ratio increase of 50 basis points by the People’s Bank of China to cool the fastest rise in consumer prices in two years was the second in two weeks. China’s benchmark stock index had its biggest two-week decline since May on speculation the monetary tightening will crimp economic growth. (Bloomberg)
Ireland: Seeks bailout as ‘outsized’ problem overwhelms nation
Ireland applied for a bailout to help fund itself and save its banks, becoming the second Euro member to seek a rescue from the EU and the IMF. Irish prime minister Brian Cowen said he expects talks on the package to be completed in the “next few weeks”. Finance Minister Brian Lenihan said the loan will be less than EUR100bn (USD137b), though he refused to give any further details. (Bloomberg)
US: Obama says surplus nations must allow currency gain, spur demand
President Barack Obama said countries running trade surpluses should boost domestic demand and allow their currencies to strengthen, repeating criticism he made of China a week ago at a meeting of global leaders. “Countries with big surpluses have to figure out how they can expand demand,” Obama said. “Countries with significant deficits will have to save more and focus not only on consumption, but also on production and exports.” (Bloomberg)
US: Consumer, business spending probably rose
Consumer spending probably picked up in October, and factories took more machinery orders, showing the US recovery strengthened entering the final quarter of 2010, economists said before reports this week. Household purchases rose 0.5% after a 0.2% gain in September, according to the median estimate of 61 economists surveyed ahead of 24 Nov figures from the Commerce Department. (Bloomberg)
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