China bubble concerns overblown - Barings

Barings' William Fong believes the interest rates in China will continue to rise but concerns of an asset bubble have been overdone.

China's gross domestic product growth reached 10.7% in the final quarter of 2009 and hit 8.7% for the year as a whole, exceeding both the Government's 8% target for the year and the market's expectations. Fong, who manages the £22m Barings China Growth fund, says the figures are a testament to the "outstanding" economic stabilisation achieved through Government-sponsored infrastructure development and believes it is infrastructure - rather than equity and property markets - that is benefiting from the high levels of borrowing. "Looking ahead, we expect interest rates to rise in China,...