Funds Management News
Warning crisis indicators flashing red in Asia
Tony Boyd: Australian Financial Review
An early warning indicator system that has reliably signalled two-thirds of the past 50 financial crises in 30 countries since the early 1990s is currently flashing red in relation to Asia.
The economies most at risk of being hit by a financial crisis are China and Hong Kong.
The early warning indicators for these two regions are at their highest point since the early 1990s, according to Robert Subbaraman in the Singapore office of Nomura Research Institute.
“At a bare minimum, Asia’s maturing and oversized financial cycle will remain a major structural drag on GDP growth in coming years,” he said.
“However, there are good reasons to heed the warning that the reversal of Asia’s financial cycle could be abrupt.”
The rest of this post can be read at the Australian Financial Review www.afr.com
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