China is spending billions to support the yuan. As a result of foreign currency reserves in Beijing last month, sank to its lowest level - based on AMarkets.
China spent $ 93.9 billion in August, reducing the share of the cache to the level of $ 3.56 trillion. This is almost twice more than in July, when it spent $ 50 billion on monetary intervention. It is obvious that the Bank of China is spending all available funds to support the national currency, which suffered greatly after the act of devaluation against the USD.
Chinese Central Bank sells dollars and buys the yuan to raise the demand for the yuan through the manipulation of supply and demand. But the problem is that the cash reserves are being depleted more and more confident. The market signal is - the yuan will continue to fall even more rapidly.Demand something artificial, and everybody understands that. This whole process promotes an outflow of capital from China. Falling renminbi increases the cost of moving the foreign capital.
Schedule: capital outflows from China (by residents and non-residents):