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And outflow of capital will only make it worse.
A falling yuan might spur the outflow of capital.
Europe has grown more slowly, leading to an outflow of capital.
Tax issues also tend to keep business offshore while not preventing a huge outflow of capital.
The yen is greatly undervalued because of the outflow of capital from Japan.
The biggest outflow of capital in China today passes through the central bank.
Similar(8)
China has been tightening the outflows of capital because they want to keep their currency relatively stable.
The model of the diversified banking conglomerate makes less sense in a world where national regulators are trying to prevent outflows of capital and liquidity.
But it does not follow from this that governments are wholly at the mercy of sudden inflows and outflows of capital.
What worries the government most, however, is not the level of the rand but its volatility, which causes wild inflows and outflows of capital and complicates planning in the public and private financial sectors.
But bankers here say that the way multinationals are financing their investments has changed sharply in the last two years and can increase China's vulnerability to sudden outflows of capital.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com