Capital outflows from China rose sharply to US$75 billion (RM357.5 billion) in September, the biggest such monthly amount since 2016, Goldman Sachs’ preferred gauge of foreign exchange flows showed, underscoring intensifying depreciation pressure on the yuan.
The trend was also evident in official Chinese data over the weekend with big outflows under banks’ forex sales and settlement business and through cross-border payment.
September’s outflows, nearly 80% higher than the US$42 billion seen in August, were driven by current account outflows as foreign investors’ net selling of equities and bonds slowed, Goldman Sachs said in a report.
There was US$35 billion in net outflows via onshore outright spot transactions last month, as well as US$45 billion of net yuan payment from onshore to offshore, the Wall Street bank said.
Despite rising yuan deprecation pressure, Goldman said it is sticking to its year-end yuan forecast of 7.30 per dollar, citing Beijing’s efforts to limit the Chinese currency’s decline.
“Policymakers appear to put more weight on confidence and stability in FX management,” Goldman said.
The yuan is one of the worst performing currencies in Asia this year, having dropped more than 5.5% against the dollar.
Big outflows were also captured by official data, according to Reuters.
China in September witnessed US$19.4 billion of outflows under forex sales and settlement business for customers, the largest monthly outflows since late 2016, State Administration of Foreign Exchange (Safe) data showed on Friday.
Moreover, monthly cross-border receipts and payments recorded a deficit of US$53.9 billion, the biggest since February, 2016.
