Market Views: What will it take to reverse capital outflows from China?
Fund managers are keeping an eye on how the Chinese government will rule on easing monetary policy, ending Covid lockdowns, and its relationship with Russia, while at the same time “bottom-fishing” for good deals in the world’s second-largest economy.
There was a massive drain of foreign capital from emerging markets in March, with China setting record outflows for both equities and bonds.
Foreign investors sold $11.2 billion of Chinese bonds and $6.3 billion of stocks in March – marking the first major stock selloff since the technology crackdown in September 2020, according to the Institute of International Finance.
The capital outflows are triggered by a mix of negative factors. They include: China’s growth slowdown, delis…
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