Chinese policymakers - schooled on average capital inflows of $40.5B/month since 2005 - are...

|By:, SA News Editor

Chinese policymakers - schooled on average capital inflows of $40.5B/month since 2005 - are going to have to adjust their game to deal with the new reality of capital outflows, writes Kevin Yao. The most likely tool is lower bank reserve ratio requirements. This has the beauty of reversing tightened liquidity without easing monetary policy in the face of still-speedy inflation.