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China to curb hot money inflows

08-17-2011 08:19 BJT

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With the yuan's value and interest rates climbing, China is making more moves to curb hot money inflows - that is, money in pursuit of fast and high returns.

In the latest, the nation's forex regulator has cut the overall size of guarantees that banks can provide to domestic firms when they raise overseas debt. So far this year, the amount that domestic and foreign banks are allowed to provide for foreign borrowings by domestic firms is down from last year's figure.

The State Administration of Foreign Exchange also said that it has stopped reviewing applications from domestic property firms that seek to provide guarantees for bond sales by their overseas subsidiaries.

More hot money inflows could put pressure on the yuan to appreciate and complicate China's battle against inflation.

The forex regulator, SAFE, has pledged to combat such inflows in the second half of this year.

Editor:Li Wanran |Source: CNTV.CN

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