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--9th Straight Monthly Gain
BEIJING (MNI) - Balanced cross-border capital flows helped nudge up China's
foreign-exchange reserves in October, the ninth straight month that forex
reserves have increased.
Foreign-exchange reserves increased $703 million during the month to
$3.1092 trillion, the highest level since last October but much lower than the
$16.98 billion rise in September, according to data released Tuesday by the
People's Bank of China (PBOC).
"In October, cross-border capital flows and transactions became more
balanced, and the supply and demand of foreign exchange was overall balanced,"
the State Administration of Foreign Exchange (SAFE) said on its official website
on Tuesday. "In the international financial market, non-dollar currencies
depreciated against the dollar while asset prices in general appreciated,
helping the level of foreign-exchange reserves to remain stable."
The dollar index rose from 93.07 on Sep. 29 to 94.57 on Oct. 31.
Traders agreed that capital flows were balanced in October.
"In October, if the yuan depreciated, many people would buy yuan, and when
the yuan appreciated, many people would sell yuan. The market is very balanced,"
said a Shanghai-based forex trader at a commercial bank. "Currently, our clients
do not want to bet on the one-sided appreciation or depreciation of the yuan."
SAFE expects the forex reserve situation to remain stable in the future.
"With the success of the 19th National Congress, both domestic and foreign
investors will have more confidence in the long-term development of China's
economy. The foundation for stable cross-border capital flows and international
payments will be even firmer, which will be conducive to helping forex reserves
remain at a relatively stable level," SAFE said.
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