Economy Apr 08

China's foreign exchange reserves fall 1.5% to $3.06trn in March

Global economic impact of coronavirus pandemic blamed

by Nadeem Xu
China's foreign exchange reserves fall 1.5% to $3.06trn in March

(ATF) – China's foreign exchange reserves fell for the second consecutive month in March, to $3.06 trillion.

The value of reserves in other currencies also fell due to the global financial market turmoil and decline in oil prices amid the coronavirus outbreak, the State Administration of Foreign Exchange (SAFE) said on Tuesday.

Wang Chunying, a spokeswoman for the regulator, said China’s forex reserves had fallen by $47.3 billion this year.

Relative to the stronger dollar, the depreciation of other currencies has led to remarkable adjustments of asset prices and influenced foreign exchange rates, Wang said.

"China's foreign exchange market remained stable, with a generally balanced demand and supply of foreign exchange," she said. 

Wang said the regulator expects the pandemic to have a severe impact on the global economy and trade growth, along with increasing volatility in international financial markets.

Chinese authorities have said they are seeing a modest output improvement and speedy resumption of production as the nation declares its virus containment measures a success. The country's real economy is recovering steadily and can support the long-term stability of foreign exchange reserves, Wang said.

China’s foreign exchange reserves fell to $3.107 trn at the end of February from $3.115trn the previous month, according to SAFE data.