China's stock market again making investors jittery, as it has started racing down fast today, after sliding close to 10% last week, that has led to turmoil in global stock market. Chinese central bank, however has kept Yuan in tight leash today, which has declined close to -1.5% last week, giving rise to fear that Beijing is devaluing its currency, which would lead to an all-out currency war.

Contrary theory to Beijing's devaluation is equally scary. If Yuan weakness in market driven, then PBoC might be having hard time to balance outflow. In December, China's FX reserve declined at record pace of $107 billion, bringing total outflow foe the year, above $500 billion. China's FX reserve is still high at $3.33 trillion, however it is dwarfed by the size of corporate debt of $22 trillion. Though most of that is not in Dollar term, drop in FX reserve, which as seen by many as source of stability in China might lead to further crisis also on domestic loan front.

China's CSI 300 index is down -4.9%, Shanghai composite is down -5.26%, Shenzhen index is down about -6.5%, while Hong Kong's hang Seng is down close to -2.5%.

All in all, not pretty start to this week too.Yuan however is trading strong at 6.583 per Dollar in onshore market, up 0.15% for the day.