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Offshore Yuan Declines as Goldman Warns Capital Outflows Rising

  • Outflows may have prompted efforts to steady currency: Goldman
  • Sovereign bonds drop as 10-year yield climbs from decade-low
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The offshore yuan halted a two-day advance, shrugging off the strongest central bank fixing since June, amid concern that capital outflows from China are increasing.

A net $55 billion left the nation in July, compared with $49 billion in the previous month, Goldman Sachs Group Inc. analysts wrote in a note, adding that their preferred gauge shows cross-border yuan outflows continue to be large. A new equity link between Shenzhen and Hong Kong could lead to funds flowing overseas because of the mainland city’s “substantially higher valuations,” according to Bloomberg Intelligence economists Fielding Chen and Tom Orlik.