PBOC orders banks to restrict foreign firms' outflow of yuan funds

The People’s Bank of China has instructed banks that provide multinational corporations with yuan cash pooling services to restrict outflows as of January 19, Caixin reported, citing unnamed sources. The central bank’s order to not let firms send more funds overseas than they bring in was an “obvious attempt to reduce the supply of yuan to international speculators betting on a weaker yuan, increasing their cost” of betting against the currency, according to an unnamed official at a regional branch of the central bank cited by the magazine. The cash-pooling service had previously faced only limits on net inflows.