China to Curb Real Estate Speculation; While Exports Grow 17.7% y/y

As I mentioned was a possibility in my recent piece, How to Play a Tightening Chinese Economy, the Chinese real estate sector should be a primary target for new policies by the Chinese government to prevent what they perceive as a burgeoning bubble. In fact this morning China’s State Council has said, “The People’s Bank of China and the China Banking Regulatory Commission will increase supervision and window guidance over the property lending business of financial institutions.” This step is likely a prelude to a more stringent response by the government in the face of escalating real estate prices.

In other news from Asia, Chinese exports reportedly grew 17.7% y/y, which is the first increase in 14 months. Asian equities reacted positively to the news. I currently have a constructive view on FXI, HAO, HOGS, CEO, SNP, & PTR in China.