Salient to Investors:
- Many investors move money out of China in ways that circumvent its tough limits.
- China’s foreign-exchange reserves reached nearly $4 trillion in 2014 but have dropped by more than $341 billion since.
- CBRE estimates that Chinese investment in overseas commercial properties totaled $6.5 billion in half1 2015 vs. $10.5 billion for all of 2014.
- Goldman Sachs said stability of the yuan and capital outflows are their biggest China concerns and estimated $150 billion to $200 billion has left the country since the August 11th yuan devaluation.
- Zhu Haibin at JP Morgan Chase estimates $340 billion left China from Q3, 2014 to Q2, 2015 vs. $264 billion according to Larry Hu at Macquarie.
- Zhang Ming at Chinese Academy of Social Sciences said capital outflows could worsen in Q3, 2015 because of deprecation expectations for the renminbi.
- Standard Chartered said polled Chinese companies expect the yuan to weaken with a limited boost to business prospects.
- Andy Seaman at Stratton Street would not advise shorting the yuan given China’s stated intention to open up the domestic capital markets over time.
- Zhong Zhengsheng at Hua Chuang Securities said China’s recent efforts to discourage betting against the yuan is a step back from China’s market-oriented revision.
- Tommy Ong at DBS Bank said Chinese central bank wants to damp short-term speculation of renminbi selling.
Read the full article at http://www.wsj.com/articles/china-boosts-efforts-to-keep-money-at-home-1441120882
Click here to receive free and immediate email alerts of the latest forecasts.