Original title: my country’s foreign exchange reserves maintained steady growth above US$3.2 trillion for eight consecutive months. Source: Economic Daily
Above US$3.2 trillion for 8 consecutive months-
my country’s foreign exchange reserves maintain steady growth
Our reporter Yao Jin
Driven by the boom in foreign trade, the scale of my country’s foreign exchange reserves has rebounded for three consecutive months. On January 7, data from the State Administration of Foreign Exchange showed that as of the end of December 2021, my country’s foreign exchange reserves stood at US$3,250.2 billion, an increase of US$27.8 billion or 0.86% from the end of November. In the previous two months, it rose by US$17 billion and US$4.8 billion, respectively, and increased by US$33.6 billion for the whole year. So far, the scale of foreign exchange reserves has been above US$3.2 trillion for eight consecutive months, and has hit a new high since 2016.
“In December 2021, the foreign exchange market will generally operate smoothly, and cross-border capital flows will be active and orderly.” According to Wang Chunying, deputy director and spokesperson of the State Administration of Foreign Exchange, the international financial market is affected by the progress of the new crown pneumonia epidemic and the expectations of major countries’ monetary policies. Affected by other factors, the U.S. dollar index fell, and the prices of financial assets in major countries went up and down. Foreign exchange reserves are denominated in U.S. dollars, and the amount of non-U.S. currencies converted into U.S. dollars increases. Together with changes in asset prices and other factors, the scale of foreign exchange reserves increased in the current month.
“Real trade and cross-border capital flows have contributed to the steady increase of foreign exchange reserves.” Wen Bin, chief researcher of China Minsheng Bank, said that relevant indicators show that overseas demand is still strong and it is expected to support my country’s exports. In December 2021, the cumulative net inflow of northbound funds was 89 billion yuan, a new high for monthly net inflows in 2021, supporting the steady increase in the scale of my country’s foreign exchange reserves.
The steady growth of foreign exchange reserves is an important indicator of the continued improvement of my country’s economic fundamentals. Industry insiders believe that the scale of foreign exchange reserves will continue to remain stable in the future. This is because the foundation for the long-term improvement of my country’s economy has not changed. A series of stable growth policies have been introduced and implemented with forward efforts, which is expected to keep the economy operating within a reasonable range and lay a foundation for the stability of the scale of foreign exchange reserves. At the same time, my country continues to open up to the outside world, international investors are optimistic about China‘s development prospects, and related securities investments are expected to remain stable, which will help promote the balance of international payments and foreign exchange supply and demand.
“In the next stage, my country’s macroeconomic policies will continue to take the lead, focusing on me, and step up efforts to support the expansion of domestic demand, stabilize external demand, and maintain economic operations within a reasonable range. At the same time, it is necessary to prevent the Fed’s monetary policy from turning risks and stabilize exchange rate expectations. , To promote the two-way fluctuation of the RMB exchange rate at a balanced and reasonable level, and to provide a safe and stable financial environment for economic recovery.” Wen Bin said.
Wang Chunying said that the current global epidemic and the world economic situation are complex and severe, and the international financial market is still facing many unstable and uncertain factors. However, my country has coordinated efforts to promote epidemic prevention and control and economic and social development, and the fundamentals of strong economic resilience and long-term improvement have not changed, which is conducive to maintaining the overall stability of the scale of foreign exchange reserves.