Currency Carry Trade by Trucks: The Curious Case of China's Massive Imports from Itself

Xuepeng Liu, Heiwai Tang, Zhi Wang () and Shang-Jin Wei

No 29633, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: With capital controls, the standard financial market transactions needed for currency carry trade are hard to implement. Using detailed trade data reported by both the mainland Chinese and Hong Kong’s governments, we present evidence that indirect currency carry trade likely takes place via round-trip reimports. We also show that greater state control in terms of more state-owned firms does not reduce such “carry trade by trucks.”

JEL-codes: F14 F3 G15 (search for similar items in EconPapers)
Date: 2022-01
New Economics Papers: this item is included in nep-cna, nep-ifn, nep-int, nep-opm, nep-ore and nep-tra
Note: IFM
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Published as Xuepeng Liu & Heiwai Tang & Zhi Wang & Shang-Jin Wei, 2023. "Currency Carry Trade by Trucks: The Curious Case of China’s Massive Imports from Itself," Review of Finance, vol 27(2), pages 469-493.

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Journal Article: Currency Carry Trade by Trucks: The Curious Case of China’s Massive Imports from Itself* (2023)
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