China restricts offshore trading with new restrictions

The news: Investors in China will be unable to open new offshore trading accounts after the government took measures to limit capital outflows from the country, Reuters reports, citing an official document and online sources. China Securities Regulatory Commission (CSRC) has told brokerages to stop offering securities trading from offshore accounts in places such as Hong Kong to new mainland investors.

The numbers: The offshore investment restrictions come after two online brokerages, Futu Holdings and UP Fintech Holding, announced plans to scrap their apps in China as Beijing began moving to restrict capital outflows and focus on data security. The yuan has lost more than 8% against the greenback in 2023.

The context: Sluggish growth in the world's second largest economy has incentivised speculation offshore as Chinese investors look elsewhere for better returns, converting their yuan and weighing on the currency's value.