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China’s top banking regulator said he’s worried about a slew of risks including the nation’s property bubble, rapid inflow of foreign capital and elevated global markets.
Guo Shuqing is “very worried” that bubbles in U.S. and European financial markets could burst as their economies are still struggling under the weight of the coronavirus pandemic.
The rallies in those markets are heading in the opposite direction of their underlying economies and will have to face corrections “sooner or later,” Guo, chairman of the China Banking and Insurance Regulatory Commission and Party secretary of the central bank, said at a briefing in Beijing on Tuesday.
Regulators are watching capital inflows into China, where the economy is still growing and interest rates are higher, to prevent disruptions, although the size and speed of such inflows remain controllable at the moment, he said.
Guo also said bubbles in China’s property market remain relatively big, with a lot of people buying homes for investment or speculative purposes, which is “very dangerous.”
— With assistance by John Liu, and Dingmin Zhang