, Columnist
Drip. Drip. Asia’s Liquidity Taps Start to Gurgle
Whisper it for now, but we may see the region’s asset markets start to operate more smoothly in the second half of the year.
They could use a lift.
Photographer: Dhiraj Singh/BloombergThis article is for subscribers only.
Last year marked the deepest deterioration in Asian liquidity conditions since 2008. While it’s nowhere close to over, the worst of the squeeze may have passed. The gears of the region’s asset markets could turn more smoothly in the second half of the year.
The signals are faint, so they’re easy to miss. In India, shadow banks’ liquidity crunch is still dangerously close to becoming an insolvency crisis for property developers. In China, economists’ forecasts of large-scale monetary stimulus are yet to materialize. Meanwhile, Chinese corporate defaults are also starting to look worrisome.