Bank of America research flags “ugly flows” from China and predicts EM currency stress from RMB depreciation

Bank of America research flags “ugly flows” from China and predicts EM currency stress from RMB depreciation The passage provides a quantitative analysis linking RMB depreciation to potential devaluation of emerging‑market currencies and highlights capital‑flight risks for China’s central bank. It offers concrete scenarios (USD/CNY 7.25 vs 8.00) and specific currency impacts, which could guide further investigation into foreign‑exchange market manipulation or policy decisions. However, it lacks direct references to named officials, illicit financial flows, or illegal activity, limiting its immediate investigative payoff. Key insights: Identifies “ugly flows” – speculative capital flight from China’s foreign subsidiaries as a systemic risk.; Quantifies EM FX sensitivity: ZAR, RUB, TRY most vulnerable to RMB depreciation.; Scenario modeling: USD/CNY at 8.00 with high volatility could depress ZAR by up to 11 ppt versus baseline.