Offshore Yuan Clearing Banks’ Repo Trade, Account Finance Halted

18 November, Shanghai

Offshore yuan clearing banks and related offshore participant banks have had their trading in bond repos and account finance suspended by the central bank, sources with direct knowledge of the matter told Reuters.

That move would limit the transfer of funds outside of the country, restricting capital outflows and contributing to holding the exchange rate stable.

“We received window guidance from the central bank on Friday,” said one of the sources at an offshore yuan clearing bank. “We have already temporarily suspended trade in yuan account financing and bond repurchases with onshore banks.” Faxes and calls by Reuters to the People’s Bank of China requesting comment were not answered.