Forex reserves up again, top $3 trillion
level in December, the yuan’s performance against the greenback has been steady after the US currency lost its upward momentum.
Wang Youxin, an economist at Bank of China, said the central bank does not need to deplete its reserves in order to stabilize the yuan.
More balanced cross-border flows will also be supported by the government’s efforts to open up the domestic capital market, according to Cheng Shi, ICBC International Research Director, referring to measures such as the mainland-Hong Kong bond connect program.
“The program is not something that has only symbolic meaning. It will generate longterm positive impact,” he said.
“An expected increase in foreign capital inflows will help offset domestic capital outflows,” he said.