News Column

Chinese Banks Record Monthly Foreign Capital Inflow

February 27, 2014

Beijing, February 27 (QNA) - Chinese banks' January foreign exchange settlement stood at 1.2 trillion yuan (203.3 billion U.S. dollars), said the State Administration of Foreign Exchange (SAFE), Xinhua news agency reported.

Foreign exchange sales by Chinese banks in January stood at 793.7 billion yuan, according to the SAFE.

The discrepancy resulted in a settlement-sales surplus of 447.5 billion yuan, the sixth consecutive monthly surplus, as well as the biggest in recent years.

Settlement-sales surplus is a major contributor to a country's foreign exchange reserve. Financial expert Zhao Qingming said, "The surplus suggested that China is confronted with high pressures of trans-border capital inflows." China's currency, the yuan, has already been affected by the fluctuation of trans-border foreign capital flows.

The yuan saw a string of appreciations in January, and hit a record high of 6.0930 against the U.S. dollar on Jan. 14.

But the currency started to tumble in February, and lost 136 basis points after five consecutive daily drops from Feb. 18 to 24.

China may continue to receive large net capital inflow in 2014, the SAFE said in a report released on Tuesday.

It noted that China's exports this year are likely be boosted by the improving world economy, especially in developed economies, and that the country's deepening reform measures may also bolster overseas investors' confidence. (QNA)

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Source: Qatar News Agency

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