China's Terrible Start to 2016 Has Beijing Fighting Market Fires
- Government said to intervene in stocks, yuan as markets fall
- Capital outflows make it harder for state to loosen its grip
2016: China’s Year of Many Uncertainties
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China has started 2016 in fire-fighting mode.
After three months of relative calm in the nation’s $6.5 trillion stock market, a 7 percent rout to open the new year prompted government funds to prop up share prices on Tuesday, according to people familiar with the matter. The central bank injected the most cash since September into the financial system to keep a lid on borrowing costs, while the monetary authority was also said to intervene in the currency market to prevent excessive volatility.