Beijing’s economic strategy is set to focus on a stimulus package aimed at stabilizing the property market and supporting China's economic growth, rather than rescuing the stock market. Sources revealed to Reuters that China's major state-owned banks have intervened to support the yuan, tightening offshore yuan liquidity and raising the cost of shorting the currency. According to Chan Ka Sing, a strong yuan is President Xi Jinping’s priority over a strong stock market, as he aims to make China a 'financial powerhouse'. This approach suggests Wall Street financiers may face reduced opportunities in Chinese markets. The People's Bank of China (PBOC) is banking on a Fed pivot to help relieve pressure on the yuan and stem capital outflows, in line with the equities rescue package that uses offshore funds to buy mainland shares. Over $6 trillion has been wiped off the market value of Chinese and Hong Kong shares since their 2021 peak, leading investors to look for government measures to steady the market.
With more than $6 trillion wiped off the market value of Chinese and Hong Kong shares since a peak in 2021, investors are hoping the government will try to steady the ship. But how would that work? https://t.co/rLgXSRAigp
Seems PBOC is banking on Fed pivot to materialize and relieve pressure on the Yuan and stem capital outflows. Goes hand in hand with the rescue package designed to use offshore funds to buy mainland shares.
The yuan looks set to become a key beneficiary of China’s plan to stem a stock-market rout, as the equities rescue package would exacerbate a scarcity of the currency overseas, putting a squeeze on short-sellers https://t.co/8OIJystUaI
When Xi Jinping talks about building China into a “financial powerhouse,” that doesn’t mean more China business for Wall Street. It means stepped-up Communist Party control. @Lingling_Wei https://t.co/mxaO1fUHFZ https://t.co/mxaO1fUHFZ
Xi wants to make China a “financial powerhouse.” For Wall Street financiers who for years have been waiting to crack open the Chinese markets, their hats in hand, that vision could mean even less Chinese business. In today’s WSJ China: https://t.co/6VfNhqIJK1 https://t.co/rn44ZXZqgL
From @Breakingviews: A strong currency is central to President Xi Jinping’s goal to make China a financial power. A strong stock market can wait, says Chan Ka Sing https://t.co/xJRBu4jTOH
A strong currency is central to President Xi Jinping’s goal to make China a financial power. A strong stock market can wait, says #ChanKaSing https://t.co/qbPMhICimW https://t.co/enHYrlqZFX
From Breakingviews - Breakingviews - Strong yuan, not stock market, tops Xi’s wish list https://t.co/65Ecku8voO https://t.co/65Ecku8voO
⭐ Today’s essential read: Sources revealed to @Reuters that China's major state-owned banks moved to support the yuan on Monday. The move effectively tightened up offshore yuan liquidity and raised the cost of shorting the currency https://t.co/ouKxUWKIoc https://t.co/MxDUfqa1D3
There will be stimulus but Beijing isn’t interested in bailing out the stock market. Instead stimulus will be focused on stabling the property market and putting a floor under China’s economic growth. Latest w/ @SeanaNSmith & @thebradsmith for @YahooFinance @ChinaBeigeBook https://t.co/cw6kT6gvTb