China’s real estate troubles could hurt global markets, US Fed warns – Community News
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China’s real estate troubles could hurt global markets, US Fed warns

According to the US Federal Reserve, problems in China’s huge real estate sector could spill over into the global economy, including the United States.

The US central bank has warned that China’s ongoing real estate troubles may exacerbate “financial tensions in China, [which] could put further pressure on global financial markets and negatively impact the United States.”

In its semi-annual report on financial stability, the Fed specifically pointed to the crisis at Evergrande, the most indebted developer in China. The company has feared contagion since September after warning it could default on its debts of more than $300 billion. Several other real estate developers are also in trouble, the report said.

While “Chinese authorities have taken steps to cool down real estate markets,” there is a risk that “financial vulnerabilities will continue to increase,” the Fed noted, CNN reported.

The central bank warned that given the size of China’s economy and financial system, and its global ties, “financial tensions in China could weigh on global financial markets as risk sentiment deteriorates, pose risks to global economic growth and could affect the United States”. , it added.

Evergrande is one of China’s largest real estate developers. The company is part of the Global 500, which means that it is also one of the world’s largest companies in terms of revenue.

Stocks in Hong Kong, New York and other major markets were previously impacted by fears of contagion from Evergrande and a slowdown in Chinese growth.

–IANS

san/arm

(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content was automatically generated from a syndicated feed.)

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