China News Service, July 17th, Wang Chunying, deputy director of the State Administration of Foreign Exchange and press spokesperson, interpreted the status of foreign exchange receipts and expenditures in the second half of the year. These four aspects will continue to play a role. Cross-border capital flows in the second half of the year should be able to maintain a relatively stable development trend.
The State Council Information Office held a press conference on the 17th to introduce foreign exchange revenue and expenditure data for the first half of 2020. Wang Chunying made the above statement at the conference.
Data map: Bank staff counts currencies. China News Service reporter Zhang Yunshe
Wang Chunying said that the foreign exchange market showed relatively high resilience and anti-risk capabilities. The main measurement indicators, no matter from the quantitative indicators or price indicators, are fully reflected.
On the one hand, in terms of quantitative indicators, the supply and demand of the foreign exchange market have maintained a basic balance. In the first half of the year, cross-border revenue and expenditure of bank customers showed a surplus, and foreign exchange settlement and sales also showed a surplus. The surplus in cross-border and foreign exchange settlement and sales reflects that the foreign exchange income and expenditure of domestic market players such as domestic enterprises and individuals are generally surplus. In the foreign exchange market, the supply of foreign exchange is relatively large. Where will these surpluses go? From the performance of the first half of the year, it is mainly due to the net purchase of foreign exchange by foreign institutions and the increase of foreign exchange positions held by banks. From this point of view, the supply and demand of the foreign exchange market in the first half of the year spontaneously formed a balance between various entities. This is an overall situation. In fact, there are still differences at different stages, but the supply and demand of domestic and overseas subjects have been changing, achieving a self-balance.
On the other hand, from the perspective of price indicators, the RMB exchange rate showed two-way fluctuations and overall stability in the first half of the year. With the changes in the domestic macro environment and market sentiment, the exchange rate of the renminbi has risen and fallen, but the overall performance is still relatively stable. From the perspective of two-way volatility, let’s review that the RMB exchange rate rose first and then depreciated in January and February. It fluctuated in March. In May, it fluctuated again due to the influence of the international market and some other events. The situation is obvious. From the perspective of exchange rate flexibility, the fluctuation range between the highest point and the lowest point of the RMB exchange rate in the first half of the year was 4.4%. This range is relatively stable and shows a certain degree of flexibility. On the whole, China’s RMB exchange rate is relatively stable. In the first half of the year, the RMB exchange rate against the US dollar declined slightly by 1.5%, but the RMB exchange rate index compiled by the China Foreign Exchange Trading Center rose slightly by 0.7%. The currency index of emerging markets fell by 11.8 over the same period. %.
Wang Chunying commented on the changes in the foreign exchange market in the first half of the year. She said that this reflects the positive results of China's overall epidemic prevention and control and resumption of production and production. It also reflects the increasing openness and maturity of the domestic foreign exchange market. Mainly manifested in the following points:
The first point is that the stable operation of the foreign exchange market reflects the overall strategic achievements made in the prevention and control of epidemic situations. Since the beginning of this year, the spread of the epidemic and the effects of prevention and control have always been an important factor affecting market sentiment, and also a key factor affecting the stability of domestic and foreign financial markets. At present, from the perspective of China's epidemic prevention and control, the effect is very prominent. It has quickly curbed the spread of the epidemic and played an important role in enhancing market confidence and stabilizing market sentiment.
The second point, the stable operation of the foreign exchange market in the first half of the year reflects the positive results of the resumption of production. We see the recent acceleration of the resumption of production and production, while the support for monetary and fiscal policies is also increasing. In the second quarter, economic growth changed from negative to positive, the main indicators resumed growth, and domestic fundamental advantages were more obvious, which all laid the foundation for continued recovery in the second half of the year. According to IMF forecasts, China may become the only major economy to maintain positive growth this year.
The third point is that the stable operation of the foreign exchange market in the first half of the year reflects the effects of the policy of continuous expansion and opening up. In recent years, we have been continuously improving the business environment and expanding the open field, which has laid a very good foundation for attracting foreign investment. We have also seen that due to the epidemic, global direct investment has been sluggish this year. In the first half of the year, China’s foreign investment reached 472.2 billion yuan, an increase of 8.4% in the second quarter. This is a very welcome achievement. With the opening of the domestic capital market, investment by foreign investors has become more convenient. Foreign exchange bureau statistics show that in the first half of this year, foreign investors increased their net holdings of domestic bonds and stocks by US$72.9 billion, of which, net increased holdings of domestic bonds by US$59.6 billion and stocks by US$13.3 billion.
Fourthly, the stable operation of the foreign exchange market in the first half of the year reflects the market's more rational and orderly development trend. The current increase in the flexibility of the RMB exchange rate is conducive to the role of the exchange rate adjustment of the international balance of payments automatic stabilizer. At the same time, it is conducive to the overall stability of market expectations, promotes rational trading by market players, and effectively promotes the balance of supply and demand in the foreign exchange market. The exchange rate has played a very good role in it. The role.
Wang Chunying said that there is still uncertainty in the global situation of the new coronary pneumonia epidemic, and it is necessary to do a good job of monitoring, tracking and preparation. It is necessary to adhere to the two-in-one management framework of "macro-prudential + micro-supervision" and make preparations for emergency prevention and control in all aspects. Cross-border capital flows in the second half of the year will be relatively stable.