CHINA’S central bank sold the least amount of foreign exchange in five months in January, reinforcing views that capital outflows have eased as policymakers step up scrutiny of cross-border flows and as the yuan steadies.

    Net foreign exchange sales by the People’s Bank of China amounted to 208.8 billion yuan (US$30.42 billion) last month, according to central bank data released Friday.

    That compared with net sales of 317.8 billion yuan in December and 644.54 billion yuan in January 2016. The State Administration of Foreign Exchange (SAFE), China’s foreign exchange regulator, said Friday that pressure from capital outflows has eased in 2017 and that cross-border flows were becoming more balanced.

    Government efforts to prop up the yuan currency pushed China’s foreign exchange reserves below the US$3 trillion level in January for the first time in nearly six years. But the drop moderated from recent months, suggesting tighter controls are slowing capital flight.

    A recent stumble in the rising U.S. dollar has also helped ease pressure on the yuan and other emerging market currencies.

    The yuan has gained 1.2 percent against the dollar so far this year, after sliding 6.6 percent in 2016.

    Currency strategists surveyed, however, expect the yuan to come under renewed pressure in coming months. (SD-Agencies)