BEIJING (MNI) – The People’s Bank of China’s foreign-exchange (forex) purchase position rose in February for a second straight month, reflecting a relatively balanced flow of supply and demand, data released by the central bank showed.
PBOC’s forex purchase position on Feb. 28 rose by CNY4.051 billion from a month ago to CNY21.48 trillion, according to a statement posted on its website on Wednesday. February’s relatively small gain was lower than January’s CNY4.48 billion increase, the data showed.
Forex market participants generally view PBOC’s forex purchase position as an indicator of China’s official capital flow. A larger increase suggests a greater capital inflow.
The value of PBOC’s forex reserves decreased by $26.98 billion in February from the previous month due to changes in the basis of valuation, PBOC said separately on March 7.
***MNI Comment: As the yuan has been trading in a range acceptable to PBOC this month, the central bank is believed to have refrained from intervening in the forex market, therefore its forex purchase position hasn’t changed significantly.
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–MNI Beijing Bureau; +86 10 8532 5998; email: [email protected]
Source: MNI