Taiwan's central bank is pushing for curbs to be imposed on the amount of Chinese capital that can be placed in local stocks, hoping to stem the inflow of speculative funds, an official said Monday.
The Financial Supervisory Commission, which has the authority to set limits on Chinese funds, has been approached by central bank officials eager to keep controls tight, said Lu Ting-chieh, the commission's chief secretary.
"The central bank has expressed the hope to us that we will cut the investment amount," Lu told AFP.
Chinese institutional investments in stocks are expected soon after January 16, when three financial memoranda signed by Taipei and Beijing in November take effect.
Among the memoranda is one that for the first time allows Chinese investors to place funds in Taiwan's stock markets.
The commission had initially set the maximum for Chinese institutional investments at an overall total of one billion US dollars, but the central bank's recent approaches indicate it considers this amount too large.
The Taipei-based Economic Daily News reported Monday the central bank's move to cut the investment amount aims to curb market speculation amid fears that a massive entry of foreign funds will destabilise the Taiwan dollar.
Copyright 2010 AFP Asian Edition
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