PBOC dep gov Yi has suggested the introduction of a "Tobin" tax to deter/punish yuan speculators
Writing in China Finance magazine Yi Gang says
- China should implement a levy, handling fees on ccy deals
He first proposed the idea a year ago but analysts say it flies in the face of China looking to satisfy the IMF's condition that the yuan be more freely usable for it to be admitted into the agency's Special Drawing Rights basket.
Nobel Laureate economist James Tobin first proposed such a levy in 1972 after U.S. President Richard Nixon's decision to abandon the dollar's peg to gold pushed up global volatility. The tax has in the past been rejected by economies from Europe to South Korea because of the risk investors will simply take their business elsewhere.
Bloomberg has more on the story here
