Recently Yahoo News on-line reported the following:
'Unprecedented' cash flows from China may be related to
Russia's status -IIF
Rodrigo Campos
Thu, March 24, 2022, 5:00 AM
By Rodrigo Campos
NEW YORK, March 24 (Reuters) - Russia's pariah status in the international investor community after Moscow's invasion of Ukraine may be behind "unprecedented" cash flows out of China, the Institute of International Finance said on Thursday.
Many emerging market and global investors are faced with steep write-downs of their Russian holdings due to sanctions across the world that were triggered by last month's invasion, which made Russia "uninvestable" for some.
"At this stage it is too early to say if the war is driving outflows or if other factors are to blame," said Robin Brooks, chief economist at the IIF.
"But we think these outflows are notable enough to at least raise the possibility that Russia's invasion of Ukraine may be pushing global markets to look at China in a new light."
He said the Russia link would be consistent with the relatively recent nature of the observed outflows.
Flows to Chinese debt and equity portfolios have mostly held up even through a stock and bond selloff triggered by a shift in policy from Beijing that pressured the property sector and came to a head last year.
Net monthly foreign flows to emerging markets outside of China had all but stopped in the last quarter of 2021 and the trend continued into 2022.
But daily high-frequency numbers compiled by the IIF show a dramatic shift in flows from a mid-December peak, especially out of Chinese stock portfolios, exacerbated in late February.
What is unprecedented, says the IIF, is that investors are pulling out of China while the rest of EM holds up.
Investors may fear that if China will actively support Russia's invasion, it would put it in line for a round of sanctions similar to Moscow's.
"While we're in this situation, I think there is going to be concerns that if China would really support Russia ... could they be included in sanctions as well," said Rick Meckler, partner at Cherry Lane Investments in New Jersey.
"Russia was very eye-opening. After all, you're talking about companies with quite significant market caps."
On Wednesday, the head of NATO said the Western military alliance worries that China could support Russia's invasion of Ukraine, while the Biden administration warned Beijing not to take advantage of business opportunities created by sanctions.
China has not condemned Russia's actions in Ukraine, though it has expressed deep concern about the war.
(Reporting by Rodrigo Campos; Editing by Leslie Adler)
Translation
紐約，3 月 24 日（路透社）- 國際金融協會 (IIF)周四表示，在莫斯科入侵烏克蘭後，俄羅斯在國際投資者界的低賤地位可能是“前所未有的”現金流出中國的原因。
由於上個月的入侵引發了世界各地的製裁，許多新興市場和全球投資者面臨著大幅削減他們在俄羅斯的持股，這使對一些人來說, 俄羅斯是“無法投資”。
IIF 首席經濟學家 Robin Brooks 表示： “在現階段，去說戰爭是在推動資金外流, 或去歸咎於其他因素, 還為時尚早。”
“但我們認為這些資金外流足夠引人注目，至少增加了俄羅斯入侵烏克蘭可能推動全球市場以新的眼光看待中國的可能性。”
他說，俄羅斯的因素與較新觀察到的流出性質有一致性。
即使中國政府的政策轉變對房地產行業造成壓力, 引發股票和債券拋售，並在去年達到危機, 但流向中國債務和股票投資組合的資金也基本保持不變。
到 2021 年最後一個季度，流向中國以外新興市場的每月淨外國資金幾乎停止，這一趨勢一直持續到 2022 年。
但由 IIF 編制的每日高頻數據顯示，資金流量從 12 月中旬的峰值後出現了巨大轉變，尤其是中國股票投資組合流出，這種轉變在 2 月下旬加劇。
IIF 表示，史無前例的是，投資者正在撤出中國，而其餘新興市場則保持堅挺。
投資者可能擔心，如果中國會積極支持俄羅斯的入侵，它將使其面臨類似於莫斯科的一輪制裁。
新澤西州 Cherry Lane Investments 的合夥人 Rick Meckler 說: “我們正處於這種情況下，我認為人們會擔心，如果中國真的支持俄羅斯......他們是否也會被納入製裁範圍” 。
週三，北約首腦表示，西方軍事聯盟擔心中國可能支持俄羅斯入侵烏克蘭，而拜登政府則警告北京不要利用制裁帶來的商機。
中國並未譴責俄羅斯在烏克蘭的行動，但對這場戰爭深表關切。
So, what is
unprecedented is that investors are pulling out of China while the rest of EM
holds up. Probably investors are serious about Biden administration’s warning
to Beijing not to take advantage of business opportunities created by sanctions
imposed by the EU, G7 and the US.
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