On Friday the Bank of China set the central parity rate, or the daily official level, at 6.7896 to the dollar, 0.3 per cent stronger than Thursday's 6.8100. The rate is a weighted average of prices given by market makers, excluding highest and lowest offers. It marks the yuan's strongest level since China freed its currency from an 11-year-old peg in July 2005 and moved to a tightly managed floating exchange rate. On Friday the yuan weakened slightly in early trading to 6.7900 on China's main foreign exchange market. 'Basically stable' In a vaguely-worded statement, the central bank said the yuan would remain "basically stable".
Friday's move is widely seen as a bid to head off rancour at the upcoming G20 meeting in Canada following intense pressure on Beijing to embrace currency reform as part of efforts to enhance a global economic recovery. Some experts say the yuan is undervalued against the dollar by up to 40 per cent. Barack Obama, the US president, said on Thursday it was too early to determine the impact of China's limited currency reform although he viewed the move as "positive". Speaking ahead of his meeting on Saturday with Hu Jintao, the Chinese president, on the sidelines of the G20 summit, Obama maintained that the "undervalued" yuan provided China "with an unfair trade advantage". For the past two years China had effectively pegged the yuan at about 6.8 to the dollar to prop up exporters during the global financial crisis. Criticism The value of the yuan has long been a source of tension between China and its major trading partners, particularly the US and EU. Critics say the policy gives Chinese producers an unfair advantage and prices competitors out of the market. US legislators, unmoved by Beijing's action, have threatened to press ahead with legislation they said will treat "currency manipulation" as an illegal subsidy and enable US authorities to impose tariffs on Chinese goods. China however repeated a warning on Thursday against "protectionist" retaliation over its currency policy, saying an appreciation in the yuan would not solve the Chinese trade surplus with the United States. Brian Jackson, a senior analyst at Royal Bank of Canada in Hong Kong, said the yuan's limited moves this week might be enough to deflect criticism at the G20. "This is not a big move, but it is significant," he told AFP. "President Hu can point to it as evidence that China is serious about making its currency more flexible when he meets other G20 leaders in Toronto." | |||||
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Friday 25 June 2010
China's yuan hits new high
Best Places In Asia To Be A Landlord
Indonesia tops the list of places where you can make the most by renting out an apartment.
HONG KONG -- Property prices in some parts of Asia are skyrocketing; since the first quarter of 2009 China's rose 68% and Hong Kong's 31%. But some of the best real estate buys may be farther south.
"We try to explain to people where they should be investing," says Matthew Montague-Pollock, Global Property Guide's publisher. "One reason is for income. One is for capital gains."
In Depth: Best Places In Asia To Be A Landlord
Jakarta boasts the best rental yield, 12.34%; Manila has 8.98% and in Kuala Lumpur a landlord can make back 8.76%. Rounding out the top five are Bangkok, Thailand, and Auckland, New Zealand.
"Not only will you make more money from the rent, but also the chance that the value of your property will appreciate is greater," Montague-Pollock says. "The yields are an excellent signal of property markets in general."
Local Indonesian markets are attracting the attention of fund managers and property developers from places like Japan, India and Singapore, according to Anton Sitorus, head of research at Jones Lang LaSalle ( JLL - news - people ) Indonesia. But they are finding some obstacles.
"Unlike investing through the stock market or through project-financing schemes, investing directly in real development projects or by buying property in Indonesia is regarded as difficult and complex for investors and individuals from overseas," he wrote in an op-ed in the Jakarta Post. "Current laws and regulations and a lack of market transparency are the main concerns hampering foreign investment."
Meanwhile, the Philippines is a particularly good pick, according to Claire Brown, founder and managing director of Claire Brown Realty, which specializes in investments in Southeast Asia for clients in the region as well as in China, Europe and the U.K.
"Most capital cities are much more expensive now. The Philippines is still really, really cheap for buying real estate," Brown says. "We've got a development in Ortigas, an up-and-coming CBD [Central Business District] in Manila. We have units for $70,000, which is ridiculously cheap compared to Hong Kong."
"You can get bank financing up to about 80% even if you're foreign. The capital gains tax has been slashed to 5% so it's easy to get in and out of that market," Brown says. "There is an abundance of expats who are happy to rent, but there is also a huge amount of local interest.
If your tenants are a mix of local nationals and a smattering of expats, you’re going to have good, healthy rental income and very few void periods.”
There are some downsides, however, to becoming a landlord in these developing Southeast Asian markets. For one, there are often roadblocks facing foreigners looking to buy property.
"You can't just walk in as a big American fund and buy a building, necessarily," says Andrew Ness, executive director of CB Richard Ellis Research Asia. "The lack of openness is what tends to keep yields high."
By contrast a place like Singapore, he adds, has a "more pronounced boom-to-bust syndrome because of its openness to global capital." Though its yields are lower--and it ranks number nine on the list with a rental yield of 3.79%--it offers other pros.
"It's the most open economy with the least restrictions on foreign investors," Ness says. "It’s the most transparent. The only problem is that a lot of the best assets are held by government-linked properties. It's not a place in Asia where we see a lot of distressed debt."
Ness also warned of the risk of inflation in countries like Indonesia, Malaysia and Thailand, as well as the reservations some foreign investors still hold after the protests in Bangkok this spring and recent terrorist bombings in Bali and Jakarta.
Indonesia, though, didn't suffer the same consequences from the global financial crisis as other Asian nations. The archipelago's economy relies less on overseas investment, which contracted in 2008, and on exports, whose buyers cut back around the same time, according to Bagus Adikusumo, director of real estate research firm Colliers International Indonesia. Those developments make Indonesia's economic climate look more attractive and resilient by comparison to its neighbors, he says, because "the other countries are getting less and less rental yield and revenue."
Aspiring landlords, take note.
In Depth: Best Places In Asia To Be A Landlord
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Thursday 24 June 2010
Apple's iPhone 4 makes stellar world debut
SAN FRANCISCO – Apple fans mobbed stores in Japan, Europe and the United States in an iPhone 4 frenzy that promised blockbuster sales despite some opening day blemishes.
 A customer looks at an |
Hundreds of people queued up through the morning on Thursday outside the Apple store in downtown San Francisco, where one person reportedly sold a place in line for 400 dollars and another swapped a spot for an iPhone 4.
Some online complaints about iPhone 4 signal strength being hampered by a troublesome antenna design did not deter those in the queue.
"It's all rumors until we get them," Robert Freedman of San Francisco said as he waited to get his hands on an iPhone 4 to replace a model he had "beat the heck out of."
"People are walking out with them and saying they are using it and everything is fine," Freedman said.
Features luring people to the iPhone 4 include high-definition screens and "Face Time," which uses a forward facing camera to enable video chat.
"I've been an Apple head since I was a teenager," said Richard Polote, a 26-year-old San Francisco man who had been waiting outside the store since 2:30 in the morning.
"I feel pretty confident that whatever problems do arise, Apple will solve them in a timely fashion with upgrades or whatever."
Some new iPhone 4 owners were chagrined to discover that cupping their new smartphones so that their palms covered the lower left corners choked off the strength of the telecom service signals, according to videos posted online.
Based on the intense launch-day demand for the iPhone 4 the analyst thinks Apple will sell them as quickly as they can make them.
"Apple told me today they are building them as fast as they can," Baker said. "Expect a serious constraint on supply, which in turn will add to the hype of people desperately wanting to get one."
Whatever launch day sales figure Apple reports "is going to be huge," the analyst predicted.
In Paris, Senegalese businessman Bassirou Gueye joined some 350 people queuing before the opening of Apple's flagship store in the city, located in the chic underground shopping mall of the Louvre museum.
"I made a special trip to Paris to buy the iPhone 4. I'm interested in its high-tech features," said Gueye, a self-avowed Apple aficionado who already owns half a dozen brand-name devices.
Some buyers in France, however, reported problems activating their new phones because of technical problems with operator France Telecom.
In Germany, there were long queues at Apple stores and phone company Deutsche Telekom complained it did not have enough handsets to meet demand.
"By lunchtime iPhones in the high tens of thousands have already been sold. In Munich we have sold out," said Deutsche Telekom spokesman Dirk Wende.
Some 500 customers waited in line outside Apple's flagship Regent Street store in London when it opened its doors -- far more than those who queued for the launch of the iPad tablet last month.
Japan's eastern time zone put it first in line to sell the phone and hundreds braved sweltering humidity outside Apple's store in the Ginza district to get hold of the smartphone.
"I am truly amazed there were huge lines in Tokyo," Baker said. "It matches the original iPhone roll-out and that just blows me away."
The original iPhone launched in 2007 brought smartphones to the masses. Apple has sold more than 50 million of the handsets in the past three years.
But its latest version enters a crowded market full of rivals boasting bigger screens and running on Google's open-source Android operating system, which is more accessible to developers than Apple's tightly guarded system.
Sales of a white iPhone 4 model have been delayed to the second half of July because of unspecified manufacturing difficulties.
Carriers in the United States and France were forced to suspend early orders because of heavy demand. Apple said last week that it set a single-day record of 600,000 orders for the new smartphone.
The new iPhone will be available in 18 other countries in July and 24 more in August.
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