China’s currency, the yuan, fell on Wednesday for the second time this week following talk that Beijing will slow the currency’s rise in order to limit inflows of speculative "hot money", Bloomberg reported. The yuan fell by 0.09% to 6.8570 to the dollar, compared to 6.8510 the previous day. The yuan gained 0.35% against the dollar in April after appreciating by 4.2% in the first quarter. April’s rise was the slowest since March 2007. The State Administration of Foreign Exchange said on July 7 that it was preparing new regulations concerning international payments for consultancy and franchising fees in order to stop capital inflows speculating on the rising currency.
For more on China’s hot money challenges, see this report from our June issue.