Aurelia Butler

The number of foreclosed homes up for auction stood at 389,000 units last year, said China Index Academy, a major independent real estate research firm. A total of 99,000 units worth a combined 150 billion yuan ($20.84 billion) were successfully sold at auctions, the firm said. Total foreclosures, including commercial, residential and industrial properties, land, garages and parking spaces, totalled 796,000 units, a record high. The number was up 36.7% from 2022, showed the survey.Last year, the troubled property market saw the worst decline in new home prices in nearly nine years, dragging on the broader recovery.China’s economy grew 5.2% last year, as credit has been diverted from the property sector towards manufacturers and as investment into infrastructure held up.The southwestern second-tier cities of Chongqing and Chengdu were the most affected by home foreclosures, logging in the most auctions last year, China Index Academy said. The number of foreclosures has been gradually rising since 2020, the firm said, and the number has continued to rise in the early days of 2024.E-commerce company JD (NASDAQ:JD).com’s said earlier this month its online auction platform has sold 11 homes worth more than 10 million yuan each in the first ten days of January. JD.com said it planned more auctions of luxury homes in top-tier cities including Beijing and Shanghai during the Lunar New Year holidays. ($1 = 7.1968 Chinese yuan renminbi) More

Leaders of the six Western Balkan countries — Albania, Bosnia, Kosovo, Montenegro, North Macedonia and Serbia — met on Monday in Skopje to discuss reforms needed to access the EU growth plan presented last October. “Today the leaders will be discussing the common regional market and the integration of the region progressively in our internal market, which is a huge driver for growth,” said Gert Jan Koopman, the European Commission’s Director-General for Neighbourhood and Enlargement Negotiations. “The growth plan is a potential a game changer and could double the size of your economies in the next decade,” he said at the start of the meeting.Having been promised EU membership years ago, the accession process across the region has slowed to a crawl, mainly due to reluctance among the bloc’s 27 members and a lack of reform throughout the region.Serbia and Montenegro were the first in the region to launch EU membership talks, and Albania and North Macedonia began talks with Brussels in 2022. Bosnia and Kosovo lag far behind their neighbours in the process.”The growth plan means 6 billion euros for the whole region and the amount of the money we will get depends on the good works that we do,” Kosovo Prime Minister Albin Kurti said ahead of the meeting. The EU growth plan for the region would include the opening of its common market to the Western Balkan countries in areas such as free movement of goods and services, transport and energy. But in return, the countries need to implement reforms and resolve all outstanding issues with their neighbours. The EU’s aim is to give greater stability to a region that emerged from the bloody 1990s break-up of Yugoslavia but is still racked by tensions.The six leaders will present a joint declaration at a press conference in North Macedonia’s capital Skopje later on Monday. More

Earnings season and a snapshot of how business activity is holding up in January as turmoil in the Red Sea wreaks havoc on supply chains are also due. Here’s a look at the week ahead in world markets from Kevin Buckland in Tokyo, Yoruk Bahceli in Amsterdam, Lewis Krauskopf in New York, Amanda Cooper in London and Ezgi Erkoyun in Istanbul. 1/ ECB VS MARKETSThe ECB meets on Thursday and for all the pushback against rate-cut speculation, traders have merely delayed bets on a first move by a month to April. Markets still expect five cuts this year.Policymakers are in no hurry to signal cuts and even some doves say it’s too early to discuss them. Expect more pushback from ECB boss Christine Lagarde, who warned traders pricing too many cuts would not help the ECB fight inflation.Euro zone inflation rose in December and wage growth is still too high for its liking. While it’s too early for a pivot, the ECB has halted rate hikes and clarified how it will wind down its pandemic-era bond-buying scheme. And Lagarde could be pushed on the impact of supply chain disruptions in the Red Sea on inflation. 2/ BATTERED YEN BULLS     Just how much the frenzy for an imminent end to Bank of Japan stimulus has quickly become a frustration is playing out in currency markets.The yen has tumbled as much as 5.6% this month alone to beyond 148 per dollar. That move has happened more quickly than December’s yen bounce to five-month peaks near 140 from a more than one-year trough near 152 in mid-November.A New Year’s Day earthquake on Japan’s west coast cleared any vestigial bets for an exit from negative rates at the BOJ’s two-day meeting starting on Monday.    Those wagers had already been tempered by dovish BOJ commentary, while recent data suggests a cooling of inflation without any central bank assistance.    Dollar/yen’s approach to 150 could trigger some jawboning from Tokyo. A weak yen is unpopular with voters, who already take a poor view of Prime Minister Fumio Kishida’s administration.3/ PUSH AND PULLAs some Federal Reserve policymakers push back on market rate-cut bets, a key U.S. inflation gauge on Thursday should shed some light on the timing of such a move. December’s personal consumption expenditures (PCE) reading comes after the price index increased 2.6% in the 12 months to November and monthly prices fell for the first time in more than 3-1/2 years. Money markets price a 61% chance of a 25 bps March cut versus a 77% chance a week ago.Higher-than-expected December retail sales numbers have also raised doubts over whether the Fed will be able to cut as early as March, as the central bank continues to wrestle inflation down from the 40-year highs hit in 2022. U.S. corporate earnings are also on the must-watch list, including Tesla (NASDAQ:TSLA), Netflix (NASDAQ:NFLX), 3M and Intel (NASDAQ:INTC). 4/ FLASH IN THE PANInvestors are betting heavily on the global economy coasting gently to a recession-free soft landing, along with rate cuts this year. The Jan. 24 flash Purchasing Managers’ Index (PMI) readings will give a sense of how business activity, in contraction territory across much of the world, has held up.New orders and hiring intentions will come under scrutiny as they are two of the more forward-looking components. New orders have trends lower everywhere, often a sign of firms preparing for tough times ahead – at odds with the rosy outlook in financial markets. On earnings, it’s a big week for European tech, with ASML (AS:ASML), Logitech (NASDAQ:LOGI) and SAP reporting, as well as luxury powerhouse LVMH. 5/ ONE LAST PUSH Turkey watchers are keen to see what size rate hike the central bank will deliver on Thursday, with a bigger-than-expected rise in the minimum wage, pre-election spending and a sliding lira keeping risks to the projected disinflation path well and truly alive.As part of an economic policy U-turn, Turkey’s central bank has jacked up rates to 42.5% from 8.5% since June to contain inflation. In December, the central bank said it was set to complete the tightening cycle as soon as possible, though Governor Hafize Gaye Erkan has pledged to maintain tight policy as long as necessary.Policymakers already downshifted tightening prospects last month, saying rates were close to a level that would keep disinflation on track. Economists expect inflation to hit over 70% by mid-year and decline to around 40% by year-end.South Africa’s central bank also meets on Thursday and is expected to keep rates unchanged. Governor Lesetja Kganyago says disinflation has begun. (Graphics by Prinz Magtulis, Pasit Kongkunakornkul, Kripa Jayaram and Sumanta Sen; Compiled by Dhara Ranasinghe; Editing by Karin Strohecker and Alex Richardson) More

(Reuters) – The European Central Bank (ECB) meets on Thursday as policymakers, not quite ready to declare victory in the inflation battle, struggle to sway trader bets on swift rate cuts.Markets are banking on a first cut in April, but the ECB wants to see more evidence of price growth slowing before pushing the button.”There has been so much speculation about the timing of the first rate cut,” said Carsten Brzeski, global head of macro at ING. “To me the question is… whether the ECB wants to address that or not.”Here are five key questions for markets:1/ What will happen this week? The ECB is certain to keep rates steady, having stopped hikes in October, then clarified in December it would phase out its pandemic-era bond-buying scheme in the second half of 2024.Analysts expect ECB chief Christine Lagarde to continue signalling it is too early to discuss rate cuts – a message not fully resonating with traders who are still pricing in 135 basis points of cuts starting in April.Policymakers, not just hawks but even a dove such as Cyprus’s Constantinos Herodotou, have pushed back. Lagarde has warned pricing in too many cuts could hurt the inflation fight. Yet they also acknowledge the need for need for “humility” given uncertainties ahead.”Lagarde’s pushback will be more indirect,” said Deutsche Bank’s chief European economist Mark Wall. “She will point to the ECB’s forecasts for resilient growth and inflation as a way to create some doubt that the ECB will ease quite as quickly as priced.” 2/ Will the ECB pivot any time soon? Markets reckon so. Traders have merely delayed expectations for the timing of a first cut to April from March and expect one fewer cut than they did last month.Even hawks such as Germany’s Joachim Nagel do not rule out a summer move. A shift in tone seems a matter of time.The ECB releases new inflation and growth forecasts in March, which could set the stage for the start of a discussion on eventual easing. 3/ How far does inflation need to fall before rate cuts?Further. Euro zone inflation rose in December for the first time since April, reaching 2.9%. While core inflation fell further, it is still above 3%.The ECB will want headline and core inflation below 2.5% to be comfortable the 2% target is in reach before cutting rates, said Berenberg chief economist Holger Schmieding. Investors are more confident; swaps markets point to inflation just above 1.5% in a year.The ECB could be pressed on the impact of Red Sea tensions, which highlight how supply chain shocks are becoming more frequent. 4/ What about wages?The ECB has singled out wages as the biggest inflationary risk. Unemployment remains at a record low.Pay growth is down from 5.2% in October 2022, a wage tracker by recruitment platform Indeed and Ireland’s central bank shows, but ticked up to 3.8% in December. Economists reckon that’s driven by new wage deals, an effect seen continuing early this year.The ECB will likely assess first quarter deals to see if pay growth falls towards the 3% it sees consistent with 2% inflation before signalling a policy shift.Lagarde expects enough data by “late spring” and chief economist Philip Lane wants to see data due in April. This would rule out a rate cut before June, the most likely start date for easing, a Reuters poll shows.”The decline in headline inflation, the fact that inflation expectations are stable, all that points to the moderation in wages… but it’s not in the data yet,” said Dirk Schumacher, head of European macro research at Natixis. 5/ How worrying is the euro zone economy?For the ECB, inflation still trumps growth concerns. With the economy seen in a shallow recession, expected to have shrunk just 0.3% in the fourth quarter, whether rate cuts start in April or in the summer won’t make a real difference, economists said. “The ECB will take the view that a rate cut wouldn’t help,” said ING’s Brzeski. “This is why they can really focus on inflation.” More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.This article is an on-site version of our Europe Express newsletter. Sign up here to get the newsletter sent straight to your inbox every weekday and Saturday morningGood morning. News to start: The leader of the far-right Alternative for Germany has told the FT that Brexit is “a model” and that she will hold a referendum on EU membership if elected.Today, I reveal what the EU’s biggest countries are proposing the bloc’s navies should do in the Red Sea, and Lithuania’s foreign minister tells my Brussels colleague how the EU should tighten its sanctions on Moscow. Plus: How can liberal democracies meet the challenge of mass migration? Join FT journalists Martin Wolf and Alec Russell and expert guests on January 24 at 13.00 GMT for a webinar exclusively for FT subscribers. Put your questions to our panel here and register for free here.All at seaFrance, Germany and Italy have urged as many of their fellow member states as possible to contribute to a plan to send EU naval assets to the Red Sea — but made clear the deployment should build on an existing mission in the region, and not try anything untested that could provoke a regional backlash.Context: Hamas’s October 7 attack against Israel has sparked spiralling violence across the Middle East, including sustained missile and drone attacks by Yemen-based, Iran-backed Houthi rebels on Red Sea shipping. A US-led naval mission is bombing them in response, while many ships are taking lengthy detours around Africa to avoid the threat.Earlier this month, Brussels proposed sending an EU-flagged mission to the conflict zone, which got in-principle agreement last week. EU foreign ministers are expected to discuss more details today — as part of a wider Middle East debate that will include possible “consequences” for Israel if it continues to block Palestinian statehood. Ahead of that, the bloc’s three biggest members have laid out some guardrails for the nascent naval mission, named ASPIDES. Their key demand is that it “mak[es] use of the already existing structures and capabilities” of an existing naval mission — AGENOR — which the three countries participate in off the coast of Iran.That mission, the three countries state in a joint paper sent to their EU allies and seen by the FT, “managed to build a considerable degree of trust and confidence with regional Arab States, while never entering in a confrontational mode with Iran”.The three authors “call upon other Member States to consider favourably their participation, with naval assets or staff contributions”, but add that the mission could be launched under Article 44 of the EU’s treaties, which allows a small group of countries to be entrusted with a task on behalf of all the others.EU officials involved in the planning of the mission say that it would entail the use of lethal force. But some member states are more squeamish about direct engagement in what could feasibly develop into a full-blown regional war.“We are not fighting piracy here. We are fighting a much more complex thing, which is, non-state actor with hybrid fighting abilities,” said one official, referring to the Houthis. “It’s a difficult, difficult operation, but the political will is there. We really consider that this is necessary for our security.”Chart du jour: Atomic dominanceYou are seeing a snapshot of an interactive graphic. This is most likely due to being offline or JavaScript being disabled in your browser.Russia dominates the world’s supplies of enriched uranium at a moment when demand for nuclear fuel is surging. Read our deep dive into the US-led plan to break Moscow’s dominance.Lost in transitLithuania is calling on the EU to ban a wider range of industrial exports from passing through Russia, over fears that many of the goods are being diverted to help Moscow’s war effort, writes Andy Bounds. Context: The EU has passed 12 packages of sanctions against Russia since its full-scale invasion of Ukraine almost two years ago. But there is evidence that Moscow can still get its hands on crucial technology. Ukraine published a report last week stating that it had found western components in many Russian weapons. “All Russian missiles have dozens of critical components manufactured abroad, many of them by companies from the free world,” President Volodymyr Zelenskyy said on Friday.Gabrielius Landsbergis, Lithuania’s foreign minister, will argue for a tighter regime at today’s meeting of EU foreign affairs ministers. “It’s a very clear request from Ukraine,” he told the FT. “The Baltic countries are the gateway to the east. That means if there’s a circumvention and if it’s going from Europe directly to Russia, it could go through us.”He said many goods that pass through Russia en route to third countries in fact never made it out again, allowing Russian factories access to vital parts. “The best thing would be that we make a decision that you cannot transit through Russia. You cannot go via Russia because we don’t believe that we’re able to control it,” Landsbergis said.As the European Commission works on its next package of sanctions, the fight to make existing measures work better continues.What to watch today EU foreign affairs ministers meet in Brussels.German Chancellor Olaf Scholz hosts French President Emmanuel Macron in Berlin.Now read theseRecommended newsletters for you Free lunch — Your guide to the global economic policy debate. Sign up hereTrade Secrets — A must-read on the changing face of international trade and globalisation. Sign up hereAre you enjoying Europe Express? Sign up here to have it delivered straight to your inbox every workday at 7am CET and on Saturdays at noon CET. Do tell us what you think, we love to hear from you: [email protected]. Keep up with the latest European stories @FT Europe More

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