Senior PBOC researcher: Must break 'feedback loop' behind yuan falls - RTRS

In an interview with Reuters on Monday, Wang Zhenying, head of the Statistics and Research Department of the People's Bank of China's (PBOC) Shanghai Head Office, noted that China needs to stem capital outflow in order to break the Yuan from the feedback loop.

Key Quotes:

"At the moment, the fall in the Yuan’s exchange rate is shaping market expectations. Depreciation triggers capital flight, and capital flight exerts even bigger pressure on the yuan" 

"Therefore, it's necessary to break this feedback loop... for example, by slowing capital outflows"

"There was a feedback loop between stock price rises, and margin financing. And when such a feedback loop was formed, trading momentum, or a trend, was formed in the market" 

"The development of the human race is propelled by an increasingly inter-connected trading network. But if we cut the network, the world economy will be separated into isolated islands, and our economic growth will slow down"