?The State Administration of Foreign Exchange (SAFE) released a statement recently concerning regulations on "the submission of non-residential RMB account information" and has collected suggestions from banks in Shanghai, Jiangsu, Guangdong, Zhejiang, Beijing and Shenzhen, the Shanghai Securities News reported Thursday.
The statement is aimed at achieving monthly data concerning RMB deposits and settlement accounts opened by overseas individuals and organizations in domestic banks. According to the report, SAFE requires banks to submit two categories of data including monthly outstanding balance and monthly balance change. In all a total of eight accounts, including RMB deposit accounts opened by Hong Kong and Macao citizens, RMB loan and drawing accounts, QFII RMB accounts, will be scrutinized.
This measure is easily linked to the current hot money issue, the newspaper cited a trader as saying.
Yuan appreciation has been accelerating since early this year and has reached an annualized appreciation rate of 16 percent. Considering the current spread between China and the U.S., hot money could achieve a risk-free revenue rate of about 12-14 percent even without any substantial investment activity.
"A lot of hot money may just rest in bank accounts," an expert on the subject told the newspaper.
Goldman Sachs' Liang Hong noted in one of his reports that most of the recent hot money may be in the form of remittances by Chinese overseas.
For more details, please read the full story in Chinese (http://paper.cnstock.com/paper_new/html/2008-06/19/content_61980967.htm).
(China.org.cn by Yan Pei, June 19, 2008)
