“The era of rock-bottom interest rates is not yet over, but the powerful boost given to global property prices by easy policy since the financial crisis appears to be ending, according to Reuters polls of over 100 housing market experts.
“More than a decade of easy money has pushed most asset prices to record highs, including house prices, which have climbed each year at many multiples of consumer price inflation and wage gains, making many markets unaffordable for first-time buyers.
“The change in sensitivity to interest rates is not universal. But it is particularly notable in the United States, where the Federal Reserve has cut rates three times this year with no major boost to the housing market outlook.
“The combined findings of the latest Reuters polls, taken this month, have implications for the effectiveness of future monetary policy in one of the most typically rate-sensitive sectors of most developed and developing economies.
“That may be all the more relevant given many central banks had made scant progress in raising rates back to what would have been considered normal levels before the global financial crisis erupted more than a decade ago.”
“The earliest-available indicators of China’s economic performance point to a continued slowdown in November.
“Economic growth was already the slowest in almost three decades in the third quarter, and Bloomberg Economics’ gauge aggregating the earliest data from financial markets and businesses shows that continuing, with a worsening picture for trade, sales manager sentiment, and factory prices.”
“Profits at Chinese industrial enterprises fell for a third straight month, dropping by the most since at least 2011 as producer prices continue falling and domestic demand slows.
“Industrial profits dropped 9.9% in October, after September’s 5.3% decrease, data from the National Bureau of Statistics showed Wednesday.”
“China raised six billion dollars in its biggest ever international sovereign bond sale on Tuesday, as it pounced on the year’s sharp dive in borrowing costs.
“The finance ministry sold the bonds in four tranches. A 3-year issue priced 35 basis points (bps) above benchmark United States treasury bonds, a source at one of the managing banks said.”
“The government has forecast the city [Hong Kong] will experience its first annual recession since the global financial crisis in 2009.
“The protests show little sign of abating, with pro-democracy parties winning a landslide in local elections.”
“Small borrowers, whose default rates have traditionally been among the lowest in India, are increasingly missing loan repayments as rising unemployment and stagnant-to-declining wages put pressure on finances of small companies as well as households.”
“Iran plans to manufacture $11 billion worth of products in the next two years to replace some imports and help contend with crippling U.S.-led sanctions.”
“Protests that have swept Lebanon since Oct. 17 have added to pressures in the financial system, deepening a hard currency crunch that has left many importers unable to bring in goods, forced up prices and increased fears of financial collapse.
“The banks’ response – tight withdrawal limits for hard currency and blocks on nearly all transfers abroad – has plunged many savers into deep uncertainty.”
“Senior doctors at Zimbabwe’s public hospitals went on strike on Tuesday to protest against the dismissal of junior colleagues who have boycotted work over pay for nearly three months, deepening a crisis in the country’s health sector…
“The strike by junior and middle-level doctors has paralyzed state hospitals, used by Zimbabwe’s poor majority.”
“The initial euphoria that accompanied Lourenço’s new presidency has ebbed away.
“Angolans are faced with the stark realities of a profoundly dysfunctional political economy that has proved more resistant to change than they had hoped for… it’s the failure to improve peoples’ lives that has led to disappointment.”
“Namibians voted on Wednesday in what was expected to be the toughest contest yet for the party that has ruled for three decades of independence, an election it was still expected to win despite a brutal economic crisis…
“The economy has been stuck in a recession for the past two years, marred by a drought that ravaged agricultural export crops, as well as by unprofitably low prices for Namibia’s main hard commodities, uranium and diamonds.”
“Complacency could blind regulators to the start of the next financial crisis warns Carlo di Florio who helped the Securities and Exchange Commission mop up after the end of the last one as the head of its exam unit.
“The danger is even though the regulators solved the problems that brought about the last financial crisis doesn’t mean they’ll prevent the next collapse…”
“Global central banks are approaching the end of the year with a collective shudder at the risky behavior that their low interest-rate policies are encouraging.
“Policy makers from European Central Bank and the Federal Reserve are among those raising cautionary flags at potentially unsafe investing stoked by their efforts to flood economies with ultra-cheap money. Stock indexes from the U.S. to India are at records, and low sovereign bond yields have pushed funds into property seeking better returns.
“The warnings are couched in measured language that doesn’t signal panic, but the combined message is one of growing anxiety, laced with the discomfort that central bankers can’t easily tighten policy either. The danger is that such risk-taking recreates a backdrop similar to that preceding the global financial crisis a decade ago.”
“Global oil consumption has apparently accelerated since mid-year as lower prices filter through the supply chain, increasing demand and avoiding a big increase in inventories.
“But all may not be as it seems. Much of the growth has come from China, where reported consumption is rising at rates inconsistent with the country’s slumping auto sales and slowing economy.
“China’s fuel distributors and consumers have most likely taken advantage of lower prices to boost the amount of products held at fuel depots and in end-user tanks before prices rise again.”
“OPEC countries, which are meeting next week to discuss their level of oil output, should make the right decision for the global economy, which remains “very fragile”, the head of the International Energy Agency told Reuters on Tuesday.”