China orders forex secrecy
Foreign exchange regulator instructs banks to keep mum on capital outflows and bans negative talk about yuan
Shanghai — China’s forex regulator is telling banks to keep its instructions about curbing capital outflows secret and to ensure that research analysts keep any negative views about the yuan’s prospects to themselves, several bankers said. The demands are seen as an attempt by the authorities to prevent alarm that could trigger further declines in the yuan, the bankers from domestic and foreign banks said. The yuan lost more than 6% against the dollar last year and is at eight-year lows, prompting a flurry of restrictive measures on capital outflows from the State Administration of Foreign Exchange (SAFE), including setting limits on banks’ currency volumes in some areas and requiring approval for ever smaller transactions. SAFE, which is part of the People’s Bank of China (PBOC), was insisting in oral instructions to dozens of banks that they do not reveal its role in such restrictions, six bankers said. SAFE and the PBOC have yet to comment. SAFE’s reticence began as far back as A...
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