China Moves to Fight Speculative Money

China on Wednesday tightened the administration of its capital controls in a move aimed at deterring speculative inflows of foreign currency.

In an announcement on its website, the State Administration of Foreign Exchange said exporters would be required from July 14 to park their export revenues in temporary verification accounts so officials can check that invoices are backed by genuine trade transactions and are not being padded.

The tightening comes against a background of growing concern about speculative "hot money" inflows that have helped swell China's foreign exchange reserves to $1.8 trillion.