PBOC unexpectedly tightens restrictions on capital outflows further

The People’s Bank of China has suspended trading in bond repos and account finance for offshore yuan clearing banks, limiting transfer of funds outside the country and further restraining changes to the currency’s exchange rate, Reuters reported, citing unnamed sources. October purchases of yuan foreign exchange had already seemingly stemmed the heavy selloff of the previous three months that followed a sudden drop. “This action may aim at curbing the speculation in the currency, but it is a little bit confusing why the central bank would take this move now,” said a trader at a foreign commercial bank in Shanghai.