The heads of the major central banks are trying to allay fears of a new financial crisis with the fall of the Chinese real estate company Evergrande.
Christine Lagarde, President of the European Central Bank (ECB), said in an interview published on Friday with the American television broadcaster CNBC: “At the moment we are seeing this focused on China.” She added: “For Europe, I can only say that it is is directly affected to a limited extent. "
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Evergrande is the second largest real estate developer in China.
The group has accumulated debts of the equivalent of more than 300 billion dollars, investors fear a default.
Evergrande needs to raise funds to pay banks, suppliers and bondholders on time.
The group is so big that some experts fear a risk of contagion for other countries as well.
The central bank is following the development, said Lagarde.
“I remember vividly the recent stock market developments in China, which had an impact across the world.
But in Europe and especially in the euro area, the direct burdens would be limited. "
Swiss central bank warns
The President of the US Federal Reserve, Jerome Powell, had made a similar statement earlier: The possible impact on American companies from Evergrande's debt problems was limited.
In contrast, the Swiss central bank warned the SNB against playing down the situation and viewing it as a local problem in China.
Economists have recently calmed down.
"If the worst comes to the worst, Beijing should intervene with state powers, so that we are currently not expecting a full-blown financial crisis," write Hao Zhou and Marco Wagner from Commerzbank.
Stockbrokers continue to be nervous
The stock exchanges are still very much concerned with the topic. According to insiders, some dollar bond holders from Evergrande have not received their interest payment due Thursday. There is now a 30-day grace period before a default becomes official, said investment strategist Michael Hewson from brokerage firm CMC Markets. Evergrande shares plunged nearly twelve percent in Hong Kong. The Dax also gave way on Friday.
"There is no precedent the size of Evergrande," said Howe Chung Wan, chief financial officer at asset manager Principal Global.
“We have to wait and see how things develop in the next few days.” However, major price turbulence such as after the bankruptcy of the American bank Lehman Brothers in autumn 2008 is not to be expected, said analyst Frank Wohlgemuth from the National Bank in Essen.
"The Evergrande problem will be dealt with by the Chinese government, its ability to intervene is too strong and the willingness to flood both the capital markets in China and the affected companies with liquidity is too strong."Keywords: