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China's Forex Reserves Rose USD108.6 Billion to USD3.22 Trillion in 2020

TaiShang

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(Yicai Global) Jan. 22 -- China’s foreign exchange reserves rose to USD3.22 trillion at the end of last year, USD108.6 billion more than at the same time in 2019, the State Administration of Foreign Exchange announced today.

SAFE will continue to promote the two-way opening of capital accounts this year, expand pilot programs to facilitate trade in foreign exchange receipts and expenditures, support regional opening innovation and the construction of special regions, study and carry out high-level cross-border trade and investment pilot openings, build an open, diversified and fully functional forex market and support financial institutions in introducing more foreign exchange derivatives that adapt to market demand, Wang Chunying, SAFE’s deputy administrator, chief economist and spokesperson, said at a press conference today.

Recent yuan appreciation has left unchanged the situation of China's current account, which still preserves a reasonable surplus. It has also not altered China's cross-border capital flow in and out of the overall balance, she added.


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Good to have some money in arms reach for emergencies.
 

shi12jun

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Increase investment in military science and technology. Make China's military more powerful. Let those anti-China forces get China's best care. :lol: :cheers:
 

beijingwalker

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China’s forex reserves rise by $108.6b to $3.22 trillion over coronavirus-inflicted 2020
By Global TimesPublished: Jan 22, 2021 04:53 PM

SOURCE / ECONOMY
China’s forex reserves rise by $108.6b to $3.22 trillion over coronavirus-inflicted 2020
By Global TimesPublished: Jan 22, 2021 04:53 PM


Photo: Xinhua
China's foreign exchange reserves reached $3.22 trillion by the end of 2020, an increase of $108.6 billion from the previous year despite the economic fallout of COVID-19, data from the State Administration of Foreign Exchange (SAFE) showed on Friday.

With the country's forex reserves shifting toward other currencies, thereby eclipsing the share of the US dollar, the strengthening of non-dollar currencies, notably the Australian dollar and Canadian dollar over the past year, has resulted in higher yields and increased China's foreign reserves, Tan Yawen, head of the China Forex Investment Research Institute, told the Global Times on Friday.

The jump was also due to the country's fast-paced work and production resumption, Tan said.

The increase exceeded estimates in early 2020 when the epidemic stoked fears of industrial capital outflows, Tian Yun, vice director of the Beijing Economic Operation Association, told the Global Times on Friday.

"China's effective virus containment measures means the country has been a must-have option for global industries seeking a safe haven against 'Black Swan' events such as the COVID-19 pandemic," Tian said.

China's forex market in 2020 was generally stable with rational and orderly exchanges, said SAFE spokesperson Wang Chunying.

Facing the phased appreciation of the yuan's exchange rate starting in the second half of 2020, Wang said that its impact on the balance of payments was within the normal range.

The average central parity rate of the yuan against the US dollar in 2020 was 6.8974, which is basically the same as the 2019 average. From the perspective of exchange rate flexibility, the one-year historical volatility of the yuan against the US dollar in 2020 was 4.2 percent, and the yuan has remained stable against major currencies.

Wang said that the appreciation of the yuan has not changed the overall balance of cross-border capital flows in China.

The spokesman said the scale of domestic investment into foreign securities skyrocketed about 40 percent from the previous year, explaining it was mainly due to Chinese mainland residents investing in the Hong Kong stock market.

"Cross-border capital flows throughout 2020 remained within a reasonable and balanced range," Wang said.

https://www.globaltimes.cn/page/202101/1213617.shtml
 

KurtisBrian

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Chinese are not Dragons. Chinese destroy their currency. Chinese serve false Jew banksters. However much money China pretends to have is irrelevant.
 

CAPRICORN-88

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Chinese are not Dragons. Chinese destroy their currency. Chinese serve false Jew banksters. However much money China pretends to have is irrelevant.
It does not matters what your beliefs are or whether or not China is a dragon that has awakened. It may be irrelevant in the West and as irrelevant as the bald head eagle of USA.

Not really if you understand what China is doing that is instilling fears into the Fed.

CBDC is not destroying the RMB as you just alleged but is in fact making it more accountable.
Even well intended bankers in the West are suggesting it but it is easier said than done.

The money in China's Forex Reserve is real unlike the American Dream. It is not made believe. It is backed by solid gold.

Conversely what is lurking in the balance sheets of the big bankers esp. in USA could be cataclysmic and so bank runs in USA is not unexpected.

Look at the number of banks listed in FDIC or Failed Bank List in USA. 561 up to date.
This is not doomsday prophecy but is real.

So in conclusion what PBOC and CRSC are doing is safeguarding investors as well as China National Security Interests. :coffee:
 

KurtisBrian

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Not really if you understand what China is doing that is instilling fears into the Fed.

CBDC is not destroying the RMB as you just alleged but is in fact making it more accountable.
The money in China's Forex Reserve is real unlike the American Dream. It is not made believe. It is backed by solid gold.

So in conclusion what PBOC and CRSC are doing is safeguarding investors as well as China National Security Interests. :coffee:
backed by gold....LOL clueless. Backed by gold is WORTHLESS. It is just more lies. China is desperate. Europe is desperate.
 

CAPRICORN-88

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Why is China massively buying gold?
Updated 2019.07.09 17:38 GMT+8

Editor's note: Gunter Schoech is a German entrepreneur, founder and managing director of Débrouillage Ltd., a Sino-German market intelligence consultancy. He writes on Sino-Western relations and macroeconomics. The article reflects the author's opinions and not necessarily the views of CGTN.
One might feel like the little boy in the fairytale “The emperor’s new clothes” looking at our global monetary system: It is inherently unstable, yet few even expose the situation for fear of the consequences, let alone take action. There is rather forced optimism, the willingness to ride the wave as long as it lasts, and modern monetary theory even attempts an academic underpinning why this time it’s different.
Since the 2008 debt crisis, according to the Bank of International Settlements, the sum of private, corporate and national debts has risen globally by 50 percent to 400 percent in China.
Lehman Brothers 2008 had 35 trillion U.S. dollars of notional derivatives causing the ripple effect. Deutsche Bank, fighting for survival 2019, has 56 trillion U.S. dollars.
Derivatives are speculative bets on the performance of an “underlying,” e.g. an asset, index, or interest rate. About 90 percent are negotiated directly between two parties, making them largely unregulated. Nobody even knows the exact volume and notional estimates go beyond 1000 trillion U.S. dollars globally. For comparison: World GDP stands at 80 trillion U.S. dollars, according to the World Bank.
Derivatives are in Warren Buffett’s words “weapons of mass destruction that morph, mutate, and multiply until some event makes their toxicity clear.” They tie financial institutions to each other, enabling a chain reaction.
What still holds things together are artificially low or zero interest rates. Historically, in a bull market, interest rates were brought back up by 4 to 5 percent as minimum ammunition to counter the next crisis. This time, the U.S. central bank failed not even halfway. The European central bank hasn’t even tried.

Gold demand between 2010 and 2019. /Reuters Photo
Low interest rates are like taking drugs, making most feel better in the short run, but with terrible side effects and payback time: Bad companies stayed in business, commercial banks’ business models are destroyed (part of Deutsche Bank’s problems), consumers load up on home-, car- credit card- or student loans, and central banks must buy up government- and even corporate debt because the free markets won’t. Other solutions are deeply unpopular like expense cutting, controlled defaults and significant redistribution of wealth.
If the world had been willing to reset the system to a sound basis, it would have done so in 2008. Instead, it printed at record levels to patch over 2008. Now we are beyond the point of no return. U.S. national debt grows faster than U.S. GDP and is 182,000 U.S. dollars per taxpayer; unfunded liabilities several times that. Personal debt per citizen is another 60,000 U.S. dollars.
Obviously, such debts can never truly be paid back, only if devalued.
Today’s paper money is backed by nothing but faith in its value, which can be lost as quickly as in the fairy tale. Latin fiat means "let it be done": Governments only decree that an intrinsically valueless object is legal tender.
Good, trustworthy money needs limited supply. Precious metals were the money of choice for thousands of years.
Paper fiat currencies are in unlimited supply if the government chooses, and thus can fail as a store of value; politically independent central banks should restrain governments which historically always lost discipline eventually.
In 2019, President Trump threatened to fire his own nominee as Federal Reserve Chairman, Jerome Powell, if he does not cut interest rates. Turkey’s president Recep Tayyip Erdogan reportedly fired his central bank chief.

VCG Photo
Countries around the world prepare for the time when the US dollar as the single reserve currency will end. Officially, they usually deny that gold is money. But in 2018, the volume of gold bought by central banks rose to its highest level since the end of the partial gold standard 1971.
Historically, France, Italy and Germany have about 60 to 70 percent of their foreign reserves in gold, and made sure to repatriate them from the U.S., also not exactly a sign of trust.
China’s foreign reserves at 3 trillion U.S. dollars are the largest in the world, thereof only 2.5 percent gold. It has unusual incentives to change this: About 60 percent of its reserves are in U.S. dollar-denominated Treasury bonds, a result of cumulated trade surpluses. This gives China a terrible trade war weapon of last resort: How could the U.S. sell new debt, which it must at its 5 percent budget deficit, if the market is flooded by China?
However, falling prices would hurt China too. So China has stopped to renew mature bonds and buy U.S. dollar-denominated gold instead in December 2018 after a two-year pause.
China prepares for a world with an increasing trade outside the U.S. dollar. Long term, it seeks to establish the yuan as a sound currency, somehow linked to gold. Official holdings of gold have more than tripled since 2008, and given imports and China being the largest miner are probably much higher.
Other states aggressively follow a similar path, e.g. Russia quadrupled its gold in a decade. Today, about 60 percent of global foreign currency reserves and global transactions are in U.S. dollars. China and Russia happen to be the two nations which have by far concluded the most and largest bilateral trade agreements abandoning the U.S. dollar. In years or decades, payment system alternatives to SWIFT and cryptocurrencies for convenience, but with a periodical account balancing between nations through the transfer of physical gold, could lead to a new, sound monetary system.
No emperor has ever looked naked in over 5,000 years if he possessed gold.
 
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KurtisBrian

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:coffee: :sarcastic::sarcastic:
After reading your reply, this fitting idiom immediately crossed into my mind.
Stupid is as stupid does.

:cheers:
I wouldn't want some know nothing South Africa digging up the money Americans or the Chinese use. I want the brilliant Americans, Japanese, Koreans, French, soon to be Chinese.... who create wonderful much needed and new things to get that money. Gold has few uses hoard as much as you like. Be like a dragon or a lizard, relax on that gold. Paper money, when honored by good people, gives power to a nation and the intelligent. Gold gives power to retards. Bad people hate money.
 

CAPRICORN-88

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As I says earlier.
Stupid is as stupid does.
Tell it to Jim Roger.
I am pretty sure between his laughter, he will give you a pat on your head.
:sarcastic: :sarcastic: :cheers:
 
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TaiShang

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I wouldn't want some know nothing South Africa digging up the money Americans or the Chinese use. I want the brilliant Americans, Japanese, Koreans, French, soon to be Chinese.... who create wonderful much needed and new things to get that money. Gold has few uses hoard as much as you like. Be like a dragon or a lizard, relax on that gold. Paper money, when honored by good people, gives power to a nation and the intelligent. Gold gives power to retards. Bad people hate money.
China is now working on digital RMB controled by the Central Bank. China preemptively safeguards its sovereignty over currency.
 

KurtisBrian

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China is now working on digital RMB controled by the Central Bank. China preemptively safeguards its sovereignty over currency.
Canada has tried something similar a couple times. People here did NOT like it. My experiences with Chinese people make me feel that the Chinese like, believe in and use hard real CASH even more than Canadians do. Do you think the Chinese will allow the CCP to take away the money? I cannot imagine the CCP pushing the Chinese people around.
 

TaiShang

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Canada has tried something similar a couple times. People here did NOT like it. My experiences with Chinese people make me feel that the Chinese like, believe in and use hard real CASH even more than Canadians do. Do you think the Chinese will allow the CCP to take away the money? I cannot imagine the CCP pushing the Chinese people around.
In Taiwan region, yes, people like paper money or credit cards. In Mainland, that's become somewhat old fashioned.

When I was in Mainland, I almost forgot there was a thing called paper money.
 

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