Chinese forex reserves expand on enhanced opening-up efforts


China’s foreign exchange reserves expanded slightly to 3.11 trillion US dollars at the end of June, official data showed Monday. The amount increased by 18.2 billion US dollars, or 0.6 percent from the end of May, according to the State Administration of Foreign Exchange (SAFE).
Wang Chunying, a spokesperson for the SAFE, attributed June’s rise to various factors, including exchange rate fluctuations and changes in asset prices. The US dollar index, meanwhile, dropped more than 1.5 percent last month, leading to the appreciation of major non-dollar currencies, said Zhao Qingming, chief economist of the derivative institute of the China Financial Futures Exchange.
An increase in bond prices also contributed to the growth in the country’s forex reserves, Zhao said.
Meanwhile, China’s gold reserves rose for a seventh straight month in June to stand at 61.94 million ounces, up 330,000 ounces from May, according to a statement from the People’s Bank of China. The reserves were valued at 87.27 billion US dollars at the end of last month, compared with 79.83 billion US dollars at the end of May.
Despite mounting external uncertainties and volatility, the Chinese economy has maintained overall stability and run within a reasonable range so far this year, Wang said, stressing that China’s foreign exchange market has kept the basic balance between supply and demand.
Wang said the country will continue to promote high-quality economic development, unveil more measures to advance all-round opening-up, and increase resilience and sustainability of the economy. These moves will provide a solid basis for the stability of foreign exchange reserves, Wang added.
A sequence of measures has already been launched by the country to open up wider in various fields. After approving a landmark foreign investment law to provide overseas investors with stronger protection and a better business environment, the country decided to encourage foreign investment in the advanced manufacturing and modern service industries.
Efforts are also being intensified to clean up the restrictive measures on foreign investments that are not specified on the revised negative lists, according to the Ministry of Commerce. Another example is the Shanghai-London Stock Connect program which opened for trading last month. It is a new step for China’s financial market to further open up to the world.
During the Summer Davos Forum, Chinese Premier Li Keqiang pledged that the country will be dedicated to expanding opening-up, uphold fair competition and safeguard foreign investors’ rights and interests. Li added that the financial sector will further open up, and financial supervision and management will become more and more well-regulated.

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