State Administration of Foreign Exchange: China's foreign exchange market is expected to maintain overall stability in August
The latest data from the State Administration of Foreign Exchange shows that in August, banks settled RMB 1386.5 billion in foreign exchange and sold RMB 1460.6 billion in foreign exchange. From January to August 2023, the bank has accumulated a foreign exchange settlement of 10435.5 billion yuan and a total foreign exchange sales of 106014 billion yuan. In August, the bank generated a foreign related revenue of RMB 4016.8 billion from its clients and made external payments of RMB 4335.2 billion. From January to August 2023, the bank generated a total of RMB 285945 billion in foreign-related revenue from its clients and a total of RMB 286729 billion in external payments.
Wang Chunying, Deputy Director of the State Administration of Foreign Exchange and spokesperson, stated that China's foreign exchange market is expected to maintain overall stability in August. In August, the deficit of bank foreign exchange settlement and sales narrowed by 30% month on month, and enterprises and other entities maintained rationality in foreign exchange settlement and sales transactions. The foreign exchange settlement rate is 72%, an increase of 5 percentage points from the monthly average level from January to July, the highest since May 2022, and the willingness of enterprises and other entities to settle foreign exchange has increased. The foreign exchange sales rate is 71%, an increase of 2 percentage points from the monthly average level from January to July, and the willingness of enterprises and other entities to purchase foreign exchange is relatively stable. From the perspective of the main cross-border capital flow channels, the net inflow of funds under goods trade has maintained a relatively high scale, reflecting the resilience of China's foreign trade development.
Wang Chunying stated that in the future, China's foreign exchange market has a foundation and conditions to become more stable. On the one hand, positive factors in the internal and external environment will further increase. With the gradual manifestation of macroeconomic regulation policies, the domestic economy is expected to continue to rebound and improve, and its support for the foreign exchange market will be further consolidated; The tightening monetary policies of major developed economies are nearing completion, and the overall impact of spillovers will be weakened; The short-term impact of seasonal factors in cross-border capital flows in China will also weaken in the near future. On the other hand, the current foreign exchange market in China is becoming more rational and mature, and the ability of market entities to adapt to environmental changes is further enhanced. The macroeconomic prudential management tools in the foreign exchange market are more perfect, which all contribute to market stability.