Chinese regulators are likely to lift restrictions on developers’ access to cash from presold properties linked up in escrow accounts, a major step toward easing the liquidity crisis.
- Regulators, including the housing ministry, and the banking regulator, are still exploring details and may present the instructions through window guidance to local governments.
- Authorities are considering a package of policies to prevent a worsening real estate crisis.
- Shares and bonds of Chinese developers jumped after Reuters reported the move to ease presale restrictions earlier.
- Regulators are refining their long-term crackdown on the property sector after a credit crisis at China Evergrande Group, and other junk-rated developers started spreading to higher-rated peers.
- A property-led plunge in the economy has driven policymakers into an easing mode, with the central bank cutting interest rates this week and committing to open its policy toolbox wider.
Beijing is set to stabilize growth in an essential year of leadership transition as challenges increase from spreading Omicron outbreaks to the continued plunge in property sales and investment.
CSI 300 Index down -0.68%, CNY USD up +0.10%Source: Bloomberg