Australia’s yuan house prices could fall very fast indeed

Thursday, 1 June 2017

Don’t look now but the yuan is suddenly rising:

It has broken its downtrend against the AUD. While I do not expect the yuan to get very far against the USD, the local unit is going to weaken and very likely fall against the yuan. Thus house prices here will be falling in yuan terms, as well as local currency (if that happens):

It didn’t stop Chinese piling in in 2014 as the yuan rose against the Aussie but if the bubble does start to look like it will fall for any length of time here then Chinese owners still in China will face very fast house price falls indeed on their Aussie holdings.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.