IMF urges investors to beware Asia overheating

The International Monetary Fund(IMF) has warned strong capital inflows into Asia have increased the risks from rapid credit growth and rising asset prices.

In its annual report on Asia, the IMF was optimistic about the region's economy, which it expects to lead a "global three-speed recovery" with growth of 5.75% this year, according to the Financial Times. However, the IMF urged policymakers to "stand ready to respond early and decisively to any prospective risks of overheating", amid widening financial imbalances in certain economies. The IMF said pressures caused by capital inflows could build if Abenomics has the desired impact on the Japanese economy. It said this could potentially put "downward pressure on interest rates and upw...