APAC Credit Roundup: APAC Cross Regional Credit Weekly, Frontier economies, Pakistan, HK Property, Seazen, Macau Gaming, Freeport

Research evidence excerpt

APAC Credit Roundup: APAC Cross Regional Credit Weekly, Frontier economies, Pakistan, HK Property, Seazen, Macau Gaming, Freeport

nment’s strategy relies mostly on

administrative and compliance measures and avoids major tax policy changes, making new

shortfalls likely. Much of the adjustment burden will shift to provincial and capital spending. We

expect the fiscal target of a 2% of GDP primary surplus in FY2026/27 to be achieved and the

IMF program to remain on track. However, we see increased risks of slippage amid signs of

austerity fatigue, and believe large primary surpluses are unlikely to outlast the current IMF

program which ends in September 2027. Please see the full report here for details. (Mahmoud)

HK Property - Home price increase to moderate to <5% in 2H26

J.P. Morgan HK Property research team noted in its report yesterday that after a 10% rebound

in HK home prices YTD (+18% from the trough last year), it expects home price increase will

moderate to <5% in 2H26. On the positive side, industry fundamentals are still solid with low

inventory months (~9 months), rising rents and increasing population. Nevertheless, on the

negative side, there are increased concerns about (1) tighter capital controls from China, (2)

rising rate hike expectations, and (3) the lackluster HK stock market YTD (Hang Seng Index:

-7% vs KOSPI Index +103%, TWSE Index +65%) may also affect sentiment in the local

property market. Overall, while the team believes the HK Property upcycle will continue on the

back of solid fundamentals, it expects the pace of home price increase will moderate to <5% for

2H26. It has kept the full-year home price forecast unchanged at +10%-15% for 2026.

While the pace of home price increase may moderate, a continual market uptrend is positive for