Fed rate hike unlikely to drain capital from China – Economic Information Daily

China won't see capital outflow even though the US Federal Reserve (Fed) is more likely to raise interest rate starting in March, the Economic Information Daily reported, citing analysts.

Key takeaways

“The yuan has stayed strong and the higher interest rate offered by China will prevent an exodus of foreign capital.”

“Yuan assets are still attractive as they are more independent from other global markets, offering investors an option to diversify risks.”

“China's higher economic growth and supply chain advantage as well as the financial market opening will help keep capital movement stable.”

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