Global markets have been moving in tandem with state of Chinese economy and US Presidential elections these days. After rebounding in the previous month, the global markets are waiting for next level triggers from US elections and stimulus plans on China's economy.
China is working on a new financial super-regulator mechanism to take care of banking, securities and insurance segments under one umbrella. Recent turmoil in the financial markets are driving the Chinese government to revamp financial monitoring mechanism.
Some of the biggest hedge funds have initiated bets against the Chinese yuan. The world billionaire investors believe that they currency will still be devaluating.
The capital outflows from the world's second-largest economy registered record level in November. The capital outflow grew almost three times in November from October.
The world's second largest economy witnessed its lowest growth rate in the last two decades. China's gross domestic product (GDP) growth rate dipped below seven percent during the third quarter for the first time after the financial crisis. A record of 6.9 percent, below the Chinese government's target of seven percent and slightly better than the forecasted 6.8 percent. This is translating into more pressure on the Chinese government to lower interest rates and some measures to strengthen the growth rate.
The Panda bond market in China is expected to surpass $50-billion mark in next five years. International Finance Corporation (IFC) is planning to sell bonds in Yuan-denominated from this year onwards.
At a time when, Chinese currency Yuan seems to be stabilizing in the foreign exchange (forex) market, the indications from the government about imposing a Tobin tax, a punitive levy, on forex transactions aimed at reducing trading in currency. After the unexpected devaluation of Yuan by 1.9 percent on 11 August, the Chinese currency fell further and recently started coming back into stabilization mode.At a time when, Chinese currency Yuan seems to be stabilizing in the foreign exchange (forex) market, the indications from the government about imposing a Tobin tax, a punitive levy, on forex transactions aimed at reducing trading in currency. After the unexpected devaluation of Yuan by 1.9 percent on 11 August, the Chinese currency fell further and recently started coming back into stabilization mode.
After gaining for a while on government's intervention, offshore Yuan fell for three sessions in a row. The Chinese government seems to be moving back from supporting the weakening currency Yuan and restricting capital outflow.
The marginal rise in Chinese currency Yuan on Monday is believed to be the extended support by the central bank of the world's second largest economy.
Downward pressure on China's economy will persist in the second half of the year as growth in infrastructure spending and exports is unlikely to pick up, a senior central bank official was quoted as saying.
China's top securities brokerages said on Saturday that they would collectively buy at least 120 billion yuan ($19.3 billion of shares in a bid to stabilize the country's stock markets after a slump of nearly 30 percent since mid-June.
China's central bank cut lending rates for the fourth time since November and trimmed the amount of cash that some banks must hold as reserves, stepping up efforts to support an economy that is headed for its poorest performance in a quarter century.
China's money supply grew at its slowest pace on record and investment growth sank to its lowest in nearly 15 years as April data showed the world's second-largest economy was still losing momentum despite a concentrated burst of policy easing.
China's central bank cut its benchmark interest rate on Sunday for the third time since November, as economic growth cools to levels not seen since the global financial crisis.
Emerging Asian central banks are expected to cut interest rates again in the coming months, but economists polled by Reuters are doubtful the moves will significantly boost growth or inflation.