China’s capital flow turned positive in the first half of 2017, a reversal from unprecedented outflows during the previous two years that sparked worries over financial stability. Data released on Monday indicate that Beijing’s support for the renminbi and a crackdown on foreign dealmaking and other outflow channels have largely succeeded in curtailing capital flight. China ran a $16bn surplus over the first half of this year, excluding central bank intervention, compared with a $417bn deficit in 2016, balance of payments data showed. The figures also showed that China added to its foreign exchange reserves on a valuation-adjusted basis in the second quarter for the first time since early 2014. The renminbi has strengthened 3.4% this year, a reversal from its record 6.5% fall in 2016, in part reflecting central bank efforts to squeeze bearish speculators and boost confidence, according to the Financial Times.
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