China considers options to support the yuan and curb outflows - BBG

Bloomberg reports latest headlines on the Chinese yuan and ongoing concerns surrounding increased capital outflows, citing that China is said to be considering options to support the yuan and curb capital outflows, including asking SOEs to convert foreign currency into yuan.

Key Headlines:

China has studied possible scenarios of yuan exchange rate and capital outflows in 2017 based on models, stress tests and field research

Is preparing contingency plans

Govt may consider asking state-owned enterprises to temporarily convert some foreign-currency holdings into yuan under current account if necessary

Financial regulators have already encouraged some SOEs to sell FX under current account

China may further cut U.S. Treasury holdings in 2017 if needed to keep exchange rate stable