Tuesday, July 23, 2013

Singapore Central Bank Says Rising Household Debt 'Worrying'

Singapore's central bank expressed concern at the growing mountain of household debt and surging property prices, saying they posed "significant risks" to the country's financial system.
While the city-state's banking system remains sound, the build-up in household debt was "worrying", said Ravi Menon, managing director of the Monetary Authority of Singapore (MAS).
He said a growing number of households have over-borrowed in the property market, largely due to low interest rates and stretched loan tenures.
"The combination of low interest rates, growing leverage and surging property prices poses significant risks to financial stability," Menon said at a news conference.
Global credit rating agency Moody's last week downgraded its outlook on Singapore's main banks from "stable" to negative", citing rapid loan growth and rising real estate prices.
Moody's said these "have increased the probability of deterioration in the banks' credit profiles under potential adverse conditions in the future".
Menon said an estimated 5 to 10 percent of borrowers in Singapore "have probably over-leveraged on their property purchases, that is, they have total debt service payments at more than 60 percent of their income".
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Wednesday, July 3, 2013

World's First Physical Precious Metals Exchange Launches in Singapore

SINGAPORE: Precious metal investors now have a new platform to trade with the launch of the Singapore Precious Metals Exchange (SGPMX).

It is the world's first precious metal exchange that is fully backed by physical precious metals.

With as little as US$1,000, investors can buy, store, transport and trade precious metals like gold and silver.

The whole process is as easy and secure as trading in other financial instruments.

SGPMX said its customer base is growing. It currently has over 10,000 customers with about 1,000 customers from Singapore and 4,000 from Japan.
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Investor and author, Jim Rogers, are among those that started to trade on the new exchange by buying more gold on Wednesday.

He is not concerned about the recent correction in gold prices and said he will keep buying more gold.

“If gold price goes down 50 per cent from its high, that will be US$960. Why can't gold sell between US$900 and US$1,000? I know it can and perhaps it will. If that happens, I hope I am smart enough to buy a lot more,” said Rogers.

Editor : This exchange sounds similar to Goldmoney.com founded by James Turk except that it also enables investors to carry out peer-to-peer buying and selling of precious metals.  All these setup points to the fact that the demand for gold and silver continues to remain bullish despite the crush of the price of gold (paper) in the futures and derivatives market.

UBS Starts Gold-Vault Service in Singapore

Switzerland’s biggest bank, started storing gold for wealth-management clients at a facility in Singapore, citing interest from investors in the region even after the metal slumped into a bear market.
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UBS joins Deutsche Bank AG and JPMorgan Chase & Co. in offering storage services in Asia, where China may surpass India as the largest user this year. Bullion fell to a 34-month low on June 28 in a rout that’s erased $66 billion from the value of investor holdings. Goldman Sachs Group Inc. forecasts further declines as the U.S. Federal Reserve may withdraw stimulus.

“Notwithstanding the drop in gold prices, we are still receiving queries on the offering from clients who are keen to reap the benefits of asset and geographical diversification,” Kok said in an e-mailed reply to questions.

The Singapore government has been promoting the country as a bullion-trading hub, removing a 7 percent sales tax from investment-grade precious metals last year. Millionaires in Asia outside Japan will create $7 trillion in new wealth by 2016, boosting the share of global riches from emerging markets to about 37 percent by that year from 24 percent at the end of 2008, according to McKinsey & Co.