China ends currency restriction on firms – Rob Delaney and Yanping Li

From via the International Herald Tribune:

In another step toward a more freely traded currency, the government on Thursday said that it would remove restrictions on how much exchange can buy to fund overseas acquisitions or expansion.

may use their own holdings, buy foreign exchange from regulators or borrow from overseas or domestic lenders to invest abroad starting July 1, the State Administration of Foreign Exchange said in a statement on its site.

China is gradually loosening controls on the yuan after ending a decade-old peg to the dollar in July. Surging exports helped drive the nation’s foreign-exchange reserves up 33 percent to a record $875.1 billion in the year to the end of March, putting pressure on the yuan to appreciate. [Full Text]

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