China FX regulator denies reports of forex controls

[BEIJING] China's foreign exchange regulator said on Friday that recent media reports about forex controls are untrue and disturb normal market operations.

The State Administration of Foreign Exchange would continue to crack down on illegal activity in the forex market, a notice posted on its microblog account said.

The Chinese government has been intensifying a campaign to put the brakes on the depreciation of the yuan, including tightening controls on capital outflows. The yuan fell more than 6.5 per cent against the dollar last year.

Earlier on Friday, Bloomberg reported that the central bank had asked some banks to stop processing cross-border yuan payments until they balance inflows and outflows.

Citing unidentified people familiar with the matter, it said the directions, issued verbally on Wednesday, required lenders to show at the end of every month that the amount of outgoing yuan matches the sum that comes in, it reported.

The PBOC has yet to respond to a faxed request from Reuters for a comment.

REUTERS