Date
12 December 2017
The PBoC said it will continue to expand the two-way flexibility of the renminbi exchange rate. Photo: AFP
The PBoC said it will continue to expand the two-way flexibility of the renminbi exchange rate. Photo: AFP

Bank outstanding forex funds growth at 8-mth low in April

Domestic financial institutions recorded a ninth straight month of growth in funds outstanding for foreign exchange in April but the growth was the slowest for eight months, the China Business News reported Friday, citing the central bank.

The People’s Bank of China said the amount of outstanding forex funds rose by 116.92 billion yuan (US$18.76 billion), down 38 percent compared with the 189.20 billion yuan rise in March. The aggregate funds outstanding for foreign exchange as of the end of April stood at 29.5021 trillion yuan.

China’s export trade recorded a surplus of US$18.50 billion in March, but the increase in funds outstanding for foreign exchange among financial institutions during the month was significantly lower than that of February, which is likely the result of the continuing depreciation of the renminbi, unnamed analysts were quoted as saying.

The PBoC said at the start of the year that it will continue to increase the two-way flexibility of the renminbi exchange rate, keeping the exchange rate fundamentally stable within reasonable and balanced levels. In March, the central bank widened the yuan’s trading band against the US dollar from 1 percent to 2 percent.

According to Minsheng Securities, the renminbi depreciated by 0.68 percent in April, as domestic interest rates and prices of venture capital assets both plunged.

Meanwhile, the central government’s holdings of US debt fell by US$800 million to US$1.2721 trillion as of the end of March. Japan also trimmed its holdings of US debt to US$1.2002 trillion, a fall of US$10.6 billion, news portal sina.com.cn reported Thursday.

– Contact us at [email protected]

EL/AC/SK

EJI Weekly Newsletter

Please click here to unsubscribe