In the meantime, Chinese yuan is expected to continue losing its value after China allowed its currency to fall below 7 against US dollar last week while how effective the measures taken to prohibit capital outflow
The current rate of 1.75 percent came a year after the previous increase mostly due to fears of massive capital outflow
and sluggish domestic economy.
An editorial by Nikkei asserts that in order to prop up the Chinese Yuan, China may begin to strengthen restrictions on capital outflow
and even travel by tourists abroad, potentially having a major impact on the world economy.
The analyst notes that the company's real problems have come into the open, namely dramatic working capital outflow
, no improvement in weak internal controls, slow admission of a smaller Onshore/Offshore business, oddities in its cash balance, and patchy customer adoption of its integrated model.
This large net capital outflow
has likely helped cap benchmark long-term bond yields in the US (and elsewhere) and a reversal of these flows could drive yields upwards.
Control over capital outflow
should be strengthened in Azerbaijan, Azerbaijani MP Fazail Aghamali said.
'It also helped to reduce, and impose tax onto the black economy, reducing tax evasion and illicit capital outflow
,' he said while debating the royal address in the Dewan Rakyat.
The kingdom is now experiencing a plunge in foreign investment and high levels of capital outflow
, according to a report in Business Insider.
The first signs of pressure in 2018 began to emerge in February when the Institute of International Finance (IIF) data shows there was a monthly portfolio capital outflow
from emerging markets for the first time since November 2016.
In an emailed response to Bloomberg, Professor Global Development Policy at Boston University, Kevin Gallagher said China came across a sudden capital outflow
in late 2016 and early 2017 due to a mix of premature capital liberalization and external conditions.
'Policy rate adjustments will help neutralize the (US) Fed rate hike on the interest rate differential between onshore and offshore, thus slowing the pace of capital outflow-As China continues to face significant capital outflow
, onshore credit conditions will tighten further and put pressure on onshore interest rates.