China's central bank said on Monday it will start implementing a reserve requirement ratio (RRR) on offshore banks' domestic deposits, in what appears to be its latest attempt to stem speculation in the yuan and manage money flowing in and out of the country.
Confusion over China's foreign exchange policy and its commitment to reforms has sparked mayhem in global financial markets in recent weeks as the People's Bank of China (PBoC) allowed the yuan to fall sharply and then moved in aggressively to try to steady it.
Sources told Reuters on Sunday that the PBoC is preparing to raise the RRR next week for yuan deposits placed in yuan clearing banks to the normal level. The rate is currently at zero.
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Confusion over China's foreign exchange policy and its commitment to reforms has sparked mayhem in global financial markets in recent weeks as the People's Bank of China (PBoC) allowed the yuan to fall sharply and then moved in aggressively to try to steady it.
Sources told Reuters on Sunday that the PBoC is preparing to raise the RRR next week for yuan deposits placed in yuan clearing banks to the normal level. The rate is currently at zero.
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