China will impose limits on the amount of money local investors can spend on Hong Kong stocks, an official said yesterday, suggesting the city will not see the wave of funds originally expected.
The announcement is the latest modification to a plan to let private investors buy directly into the Hong Kong stock market, which triggered initial expectations that the city would be flooded in liquidity.
"There will be investment limits for the scheme," Xia Lingwu, a spokesman with the China Banking Regulatory Commission said, confirming a report in the Financial Times.
Liu Mingkang (
"They can lift and readjust the quota if necessary and appropriate -- it's a flexible ceiling," Liu said.
The State Administration of Foreign Exchange announced last month that residents of China could invest an unlimited amount in Hong Kong stocks under the pilot scheme.
But the plan, designed to ease excessive liquidity in China and give people a wider choice of investments, has since been steadily adjusted.
TRIAL RUNS
The business magazine Caijing reported on Monday the plan would initially be open just to residents of Tianjin, where it will undergo the first trial runs.
The number of institutions handling the investment scheme -- currently limited to the Bank of China and Bank of China International -- will also be expanded, it reported.
Delays in implementing the program have triggered speculation that powerful government agencies opposed it, but the banking regulator denied that the program was in direct jeopardy.
YUAN CONVERTIBILITY
In related news, China has no timetable for full convertibility of the yuan, People's Bank of China Governor Zhou Xiaochuan (
Zhou added China will take a step-by-step approach to currency reform as the nation moves to further develop its domestic financial and insurance markets.
China restricts trading in the yuan and limits the range of its daily movements to 0.5 percent above or below the previous day's closing value.
Zhou also reiterated the central bank's unease over fast rising stock and real estate prices.
China "is quite concerned about asset prices," Zhou said, without elaborating.
The benchmark Shanghai Composite index has more than doubled this year as investors have poured their money into the market. Meanwhile, inflation in China reached an 11-year high of 6.5 percent last month, brought on by a surge in food prices and continued rapid expansion of the economy.
To cool inflation and borrowing, Beijing last week raised benchmark interest rates for the fifth time this year, lifting them by 0.27 percent point to 7.29 percent.
Zhou also said this week's larger-than-expected rate cut in the US isn't a constraint to China's monetary policy, although he said the chance for arbitrage and carry trades exist as a result of the interest rate gap between the US and China.
"China's interest rate policy is very much based on domestic economic considerations such as domestic CPI, domestic investment, and domestic consumption," Zhou said.
However, Zhou said the central bank will stay on the lookout for further movements of US interest rates. The Federal Reserve cut its key interest rate a half point to 4.75 percent on Tuesday.
SEMICONDUCTORS: The German laser and plasma generator company will expand its local services as its specialized offerings support Taiwan’s semiconductor industries Trumpf SE + Co KG, a global leader in supplying laser technology and plasma generators used in chip production, is expanding its investments in Taiwan in an effort to deeply integrate into the global semiconductor supply chain in the pursuit of growth. The company, headquartered in Ditzingen, Germany, has invested significantly in a newly inaugurated regional technical center for plasma generators in Taoyuan, its latest expansion in Taiwan after being engaged in various industries for more than 25 years. The center, the first of its kind Trumpf built outside Germany, aims to serve customers from Taiwan, Japan, Southeast Asia and South Korea,
Gasoline and diesel prices at domestic fuel stations are to fall NT$0.2 per liter this week, down for a second consecutive week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) announced yesterday. Effective today, gasoline prices at CPC and Formosa stations are to drop to NT$26.4, NT$27.9 and NT$29.9 per liter for 92, 95 and 98-octane unleaded gasoline respectively, the companies said in separate statements. The price of premium diesel is to fall to NT$24.8 per liter at CPC stations and NT$24.6 at Formosa pumps, they said. The price adjustments came even as international crude oil prices rose last week, as traders
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which supplies advanced chips to Nvidia Corp and Apple Inc, yesterday reported NT$1.046 trillion (US$33.1 billion) in revenue for last quarter, driven by constantly strong demand for artificial intelligence (AI) chips, falling in the upper end of its forecast. Based on TSMC’s financial guidance, revenue would expand about 22 percent sequentially to the range from US$32.2 billion to US$33.4 billion during the final quarter of 2024, it told investors in October last year. Last year in total, revenue jumped 31.61 percent to NT$3.81 trillion, compared with NT$2.89 trillion generated in the year before, according to
PRECEDENTED TIMES: In news that surely does not shock, AI and tech exports drove a banner for exports last year as Taiwan’s economic growth experienced a flood tide Taiwan’s exports delivered a blockbuster finish to last year with last month’s shipments rising at the second-highest pace on record as demand for artificial intelligence (AI) hardware and advanced computing remained strong, the Ministry of Finance said yesterday. Exports surged 43.4 percent from a year earlier to US$62.48 billion last month, extending growth to 26 consecutive months. Imports climbed 14.9 percent to US$43.04 billion, the second-highest monthly level historically, resulting in a trade surplus of US$19.43 billion — more than double that of the year before. Department of Statistics Director-General Beatrice Tsai (蔡美娜) described the performance as “surprisingly outstanding,” forecasting export growth
RSS