More Chinese home buyers, on the way

MarketWatch: China’s capital outflow accelerated in November, forcing the Chinese government to more aggressively prop up the yuan via interventions, according to an estimate from Capital Economics.

“The pick-up in capital outflows appears to have been predominantly driven by increased expectations for renminbi depreciation,” said Julian Evans-Pritchard, a China economist at Capital Economics.

An increase in offshore interest rates on expectations of a U.S. Federal Reserve interest-rate hike is also likely to have contributed to outward flow of capital, he added.

By Evans-Pritchard’s reckoning, net capital outflow from China totaled $113 billion, compared with $37 billion in October.

The economist’s estimates are based on the fact that the country’s foreign exchange reserves fell $87 billion in a month to $3.438 trillion at the end of November,marking its lowest level in more than two years.