It hails govt move to increase land supply to the market
The International Monetary Fund (IMF) said yesterday it shares Hong Kong’s concern that the city may face sharp asset price inflation and encouraged the government to look at increasing land supply for property development.
‘We share the authorities’ concerns that a credit- asset price cycle could take hold, leading to a sharp run-up in prices for certain real and financial assets,’ the IMF said in an annual report on Hong Kong.
‘While such asset price movements are part of the natural equilibrating mechanism of the Hong Kong economy, there is a risk that prices could become driven more by short-term liquidity conditions, divorced from fundamental forces of supply and demand.’
The Washington-based organisation also said it had raised its gross domestic product (GDP) forecasts for Hong Kong following a recent improvement in the economy.
It forecasts a 2 per cent decline in GDP this year, against a 3.5 per cent decline previously, and 5 per cent GDP growth in 2010, up from 3.5 per cent previously. Continue reading
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