Reported 10 months ago
China's efforts to rejuvenate its stock market have unintentionally put pressure on the yuan due to unprecedented dividend payouts. Hong Kong-listed Chinese companies are set to distribute a record $12.9 billion in interim dividends, following a substantial $16.2 billion payout in the last quarter. These dividend outflows, primarily paid in Hong Kong dollars but earned in yuan, pose challenges for Beijing in maintaining short-term stability amid rising US-China tensions and a strengthening dollar. This dividend push, prompted by recent capital market reforms, aims to enhance shareholder returns but may adversely affect the currency's value.
Source: YAHOO