T Rowe Price has said that it has moderated its overweight position in Asia credit due to short-term headwinds in China.
In its latest insight on global asset allocation and the investment environment published by Thomas Poullaouec, head of multi-asset solutions for Asia Pacific, the asset management giant attributed this to softening macro data in July, Covid-19 flare ups, property market restructuring and lack of broad-based easing measures.
T Rowe Price is not the only firm to have changed tack on China in recent weeks.
Earlier this month, UBS Wealth Management downgraded its outlook on Chinese equities to neutral from most preferred, citing the impact of Covid lockdowns and the government’s unwillingness to intervene too aggressively in the property sector among other things.
Pictet Asset Management also recently downgraded Chinese stocks to neutral from underweight. It noted that Chinese equities were currently cheap, although this was not enough to compensate for the risks, particularly in the country’s property sector.