China Pushes to Keep Foreign Exchange Regulations a Secret: Reuters
In an exclusive report, Reuters claimed that Chinese banking regulators are pushing financial institutions to keep foreign currency regulations a secret. These regulations are primarily concerned with curbing the flow of capital outside the country.
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The report also claimed that the authorities have instructed analysts to refrain from making any negative reviews about the future prospects of yuan. It is believed that these steps have been undertaken to control the panic and reduce the risk of further downslide of yuan value.
It further claimed that State Administration of Foreign Exchange (SAFE) has given verbal instructions to banks to specifically vet all the cross-border transactions over $5 million or more. Earlier, this limit was set at $50 million.
SAFE released a statement on Wednesday with its Shanghai branch claiming that it has not adopted new steps for controlling cross-border payments and forex conversions. However, it advised banks to exercise proper safeguards to ensure authenticity of the transactions as well as the compliance with the rules.
However, these claims have been rubbished by the SAFE, which is a part of The People's Bank of China. It said that the media reports making such allegations are "inaccurate, and is misleading public opinion and disturbing normal operations of the Forex market."
China is currently looking to control the value of its currency and to stem the capital outflow from country. Yuan is currently on a declining spree and is down to its lowest level since 2009. The country is also grappling with the issue of declining reserves, which fell to $3.05 trillion in November.