February 9, 2024
United States:
Risk of Big US Inflation Revision Puts Policymakers, Investors on Edge
Mention the government’s annual revisions to seasonal adjustment factors for monthly inflation data and you’re likely to make eyes glaze over, even among hardcore economics nerds. Not this year.
Economists on Wall Street and in Washington will be tuning in for this year’s update, due Friday morning, because of what happened a year ago: The revisions to the consumer price index — typically small and therefore ignored — were large enough to cast doubt on overall inflation progress.
Europe:
ECB Warns Banks of Consequences for Poor Property Risk Management
The European Central Bank is signaling to lenders that they may face higher capital requirements if they have an insufficient handle on risks they face from commercial real estate, according to people familiar with the matter.
The watchdog is placing greater emphasis on the management of commercial property risks, in a dialog with banks that comes before the annual bar for their financial strength is set, said the people, who asked to remain anonymous as the discussions are private.
Asia:
China’s Property Crisis Is Starting to Ripple Across the World
Chinese investors and their creditors are putting up “For Sale” signs on real estate holdings across the globe as the need to raise cash amid a deepening property crisis at home trumps the risks of offloading into a falling market. The prices they get will help finally put hard numbers on just how much trouble the wider industry is in.
The worldwide slump triggered by borrowing-cost hikes has already wiped more than $1 trillion off office property values alone, Starwood Capital Group Chairman Barry Sternlicht said last week. But the total damage is still unknown because so few assets have been sold, leaving appraisers with little recent data to go on. Completed commercial property deals globally sank to the lowest level in a decade last year, with owners unwilling to sell buildings at steep discounts.
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