As the Chinese yuan continues its slide in the currency market, the larger public is starting to feel the effects of the slump.
People planning to take overseas trips, particularly those heading to the United States, are now on a rush to purchase more dollar currencies before they further increase in price against the lowering yuan, Shanghai Daily reported.
Office worker Jimmy Chen, for instance, said that he will be bringing more dollars in cash with him for his trip to the U.S. ahead of the Chinese New Year. Chen explained his decision was to avoid having to pay his credit card bills with a weakened yuan later.
However, those wanting to exchange the yuan for the dollar before the latter becomes more expensive can expect to find the attempt becoming more difficult, as the Chinese government has launched a more intensive effort to curb the yuan's continuing devaluation.
Under the new system rolled out by the People's Bank of China (PBOC), foreign exchange transactions made by individuals, be it through bank branches or online, will be recorded. Individuals are also not allowed to transfer amounts greater than $50,000 to overseas in a single day without presenting a proof of payment.
The PBOC has also stepped up action against potential abuses of the annual foreign exchange quota. A watch list is currently being set up that would monitor people who are suspected to be using their $50,000 annual foreign exchange quota to lend out funds to other people.
The yuan has experienced a considerable dip in its price since the start of the year, Channel News Asia reported. On Friday, offshore trading of the currency lagged behind onshore trading by -0.18 percent, closing at 6.591 to a dollar, which was nevertheless stronger than the previous day close of 6.6165.