PBOC imposes further restrictions to limit capital outflow

By FXStreet FXStreet (Mumbai) – As reported by Reuters, the People’s Bank of China has further tightened restrictions in order to limit outflows. The central bank suspended trading in bond repos and account finance for offshore yuan clearing banks, limiting transfer of funds outside the country and further restraining changes to the currency’s exchange rate.

Reuters noted, “China tries to hold the yuan flat in the run-up to the International Monetary Fund’s decision on whether to include the currency in its reserve basket.”

A trader at a foreign commercial bank in Shanghai stated, “This action may aim at curbing the speculation in the currency, but it is a little bit confusing why the central bank would take this move now.”
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Source:: FX Street