China faces one trillion in unsold newly built property | Morning Markets

Today our focus is China with Kevin Kidney, Head of Asset Allocation, looking at the People’s Bank of China and their decision to lower interest rates to encourage further borrowing from the private sector. China remains in a post property crash bust with an equivalent one trillion dollars worth of unsold properties, which will cause prolonged consequences for growth in an economy which is aging rapidly. Similar property bubbles in the west have historically taken 5-7 years to resolve so China is facing a big challenge and interest rate cuts will just not be enough to stimulate the economy.