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China Said to Put Reserve Rule on Offshore Bank Yuan Funds

  • Officials extending effort to counter speculation against yuan
  • Premier Li underscores `no basis' for continued yuan slide
Paramilitary policemen patrol in front of the People's Bank of China in Beijing. China’s central bank will impose required reserve ratios on yuan deposits of offshore participant banks in the mainland in a bid to stabilize the currency.

Paramilitary policemen patrol in front of the People's Bank of China in Beijing. China’s central bank will impose required reserve ratios on yuan deposits of offshore participant banks in the mainland in a bid to stabilize the currency.

Photographer: Greg Baker/AFP via Getty Images
Bloomberg News
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China is stepping up efforts to counter speculative bets against the nation’s currency, through imposing reserve requirements on yuan deposits held on the mainland at offshore participant banks.

The move follows pledges by Chinese officials to maintain a stable exchange rate, and a squeeze in interbank funds in Hong Kong that saw borrowing costs in yuan in the city soar to a record last week. Premier Li Keqiang on Friday said that there was "no basis for a continued depreciation of the yuan exchange rate." The offshore yuan advanced after news of the latest measure.