Outflows
in sentence
228 examples of Outflows in a sentence
If a significant proportion of investors do so, the capital
outflows
will dwarf even China’s massive foreign-exchange reserves, which amount to around 30-35% of GDP.
But if that were true, we would now be seeing significant long-term capital
outflows
and heavy selling of RMB for dollars in China’s foreign-exchange market.
Reverse arbitrage meant capital
outflows
from the Chinese mainland.
In mid-2013, when the Fed announced that it would gradually reduce its unconventional monetary-policy measures (for example, large-scale purchases of mortgage-backed securities), emerging markets suffered large capital
outflows.
Today, it could undertake similar swaps, but with countries facing large capital outflows, thereby slowing the dollar’s appreciation.
If interest rate hikes, depreciation or devaluation of the currency, and controls on financial
outflows
are not viable options, what can a country’s central bank do when faced with accelerating capital flight?
Of course, China in 2016 is different in many ways from Thailand in 1997; but there are key similarities in their responses to ongoing capital
outflows.
Thailand introduced controls on
outflows
in 1997, and China tightened its controls earlier this year.
Efforts to sterilize capital
outflows
often end poorly.
The ruble’s free fall has been driven mainly by capital
outflows.
In that context, raising the interest rate sharply makes sense, and officials may be hoping that the hike will stem capital
outflows
– despite the risk that the decision, if interpreted as being aimed at defending the currency, could have the opposite effect.
Never mind that the central bank is not responsible for Russia’s troubles – the run on the ruble, the recession, and the flare-up of inflation – and that using interest rates to prevent capital
outflows
always fails.
Emblematic of the difference between the UN and the G-20 conferences was the discussion of bank secrecy: whereas the G-20 focused on tax evasion, the UN Conference addressed corruption, too, which some experts contend gives rise to
outflows
from some of the poorest countries that are greater than the foreign assistance they receive.
Those receiving the money are as responsible for this tragic situation as those providing it; but we can stop, and reverse, these
outflows.
One obvious cause of these
outflows
is poor governance in developing countries.
Large inflows appreciate currencies, reduce competitiveness, and destroy jobs; sudden
outflows
cause those appreciated currencies to crash, bankrupting local financial institutions and requiring costly bailouts at taxpayers’ expense.
During the second half of last year, the 15 largest emerging-market economies experienced the biggest capital
outflows
since the 2008 global financial crisis.
The countries at greatest risk of large capital
outflows
include those that are dependent on external financing, those with commodity-heavy economies, and those with uncertain political conditions.
China has remained a small source of FDI outflows, but that, too, is changing rapidly.
An increase in FDI
outflows
is a priority in China for two reasons.
So far, China’s FDI
outflows
have been concentrated in developing countries and a handful of resource-rich developed countries, including Australia and Canada, and have been aimed at facilitating trade and acquiring access to natural resources.
The spillover from the developed countries’ latest round of QE is beginning to show up in emerging markets, where nearly a year of short-term capital
outflows
has given way to a new wave of short-term inflows.
Brazil’s currency, the real, has fallen to its lowest level against the US dollar in more than four years, compelling the government to pump billions of dollars into the foreign-exchange futures market and raise interest rates to deter capital
outflows
– just a few years after imposing a new tax to deter inflows.
In order to transform the funds into renminbi outflows, the firms then increase the scale of renminbi settlements in cross-border trades.
The reasons are mainly homegrown: a poor investment climate, heavy capital outflows, and a shriveling current-account surplus.
None of these scenarios correspond with the slogans of Syria’s 2011 revolution, or with Western interests in stabilizing the country, stemming refugee outflows, and, eventually, promoting democratization.
But, as US monetary policy follows the path of interest-rate normalization, there could well be knock-on effects, both economic and financial, especially in the form of currency volatility and destabilizing
outflows
from emerging economies.
They cannot be confident of appropriate reactions by their policymakers to rapid capital outflows, or of their capacity in terms of policy tools, reserves, and balance sheets.
The other – arguably more serious – problem was market confusion about the direction of the renminbi exchange rate, following a gradual but constant ten-day depreciation against the US dollar that fueled capital outflows, until the People’s Bank of China (PBOC) intervened.
Finally, China continues to exercise tight control over its financial system, as well as maintaining restrictions on capital inflows and
outflows.
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