Economics
China Quietly Revamps Tools for Controlling Capital Outflows
- SAFE tells lenders they must watch FX business more closely
- Tighter compliance will help curb outflows, Tommy Xie says
Pedestrians walk along an elevated walkway in the Lujiazui Financial District in Shanghai, China.
Photographer: Bloomberg/BloombergThis article is for subscribers only.
China has quietly revamped its tools for handling capital flows -- an issue that takes on added importance as the yuan slips near the key 7 a dollar level.
After many years of plugging loopholes in its safety net only in response to an imbalance, the currency regulator has gone on the offensive. The State Administration of Foreign Exchange has now put the onus on banks to more closely monitor and balance their foreign exchange businesses in line with the government’s views.