China Property Slump Spurs Local Governments’ Quest for Cash

China’s property crisis has hit local governments hard, drying up a key source of income as land sales crumble. Fiscal reform plans have sparked hope relief is on the way, but economists see little progress, the Wall Street Journal reported. Cash-strapped and indebted, regional governments are seeking alternative revenue streams to compensate for falling land and tax income. That is a worrying sign that fiscal conditions are deteriorating, analysts say, and bodes ill for China’s sputtering economy.
China
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Hong Kong Property Pain Worsens for New World and Scion CEO

Hong Kong’s property downturn is taking a growing toll on New World Development Co., the firm owned by the billionaire Cheng family, Bloomberg News reported. The company said late on Friday it expects to post a loss of as much as HK$20 billion ($2.6 billion) for the financial year ended in June — its first annual loss in two decades. Its share price plunged 13% on Monday to the lowest level since 1986, when Bloomberg started tracking the data.
Hong Kong
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South Korean Inflation Slowing to Target Nudges BOK Closer to Pivot

South Korea’s inflation slowed more than expected to the central bank’s target, opening the door for monetary officials to conduct a policy pivot as soon as next month if home prices also show signs of easing, Bloomberg News reported. Consumer prices advanced 2% in August from a year earlier, moderating from a 2.6% clip in July, the statistics office reported Tuesday. Economists surveyed by Bloomberg had forecast the pace of price growth would ease to 2.1%. The deceleration was amplified somewhat by comparisons with last year, when price growth surged on higher energy costs.
South Korea
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