US woes may spark writedowns

SHANGHAI: The fallout from the US financial woes could trigger a further writing down of asset value and prompt Chinese leaders to speed up the shift in focus to economic growth from inflation, analysts said yesterday.

The demise of Lehman Brothers and troubled Merrill Lynch being forced to accept a takeover by Bank of America Corp probably triggered the central bank's decision to cut lending rates and lower its reserve requirement ratio for smaller lenders, providing further evidence that an overall macroeconomic policy turnaround is on the way.

They expect the central bank to relax the credit quota, lower the reserve requirement ratio further and possibly cut policy rates at least one more time before the year's end.