China’s March foreign reserve surges to seven-month high

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China’s March foreign reserve surges to seven-month high

On Sunday, the 7th of April 2019, China’s Central bank had posted a rise in the China’s foreign reserves for fifth straight month in a row in March and the figure had widely beaten previous forecasts, offsetting concerns of a slowing economic growth amid renewed prospect of a Sino-US trade deal much sooner-than-anticipated, as US President Donald Trump last week had expressed sheer optimism over signing a trade pact with China within next four weeks.

According to Sunday’s China’s Central bank data, Chinese foreign reserve, the largest in the world, which once had saved global markets during the 2008-2009 recessions, had surged by nearly $9 billion in March to $3.099 trillion, remarking its highest level since last August, while economists had forecasted a rise of $5 billion to $3.095 trillion.

Following the release of the data, China’s Forex regulator said, “The U.S. dollar index strengthened slightly in March due to China-U.S. trade talks, the revised policy outlooks of central banks in Europe and America as well as uncertainty over Brexit...China’s forex reserves expanded marginally”.

Apart from that, the State Administration of Foreign Exchange had been quoted saying that the Chinese economy was expected to maintain a comprehensible momentum and growth, meanwhile adding further flexibility in to the exchange rate of Chinese Yuan, and the nation’s foreign reserve would remain stable.

Chinese Yuan dropped as much as 5.3 percent last year, apparently on SAFE initiatives to grapple with a tariff war with United States amid heightening risks of imposing further tariffs on $200 billion worth of Chinese goods, while Yuan had rebounded more than 2 percent so far this year, as United States trade negotiators had necessitated China not to devaluate their currency further, and trade talk optimisms had also buoyed the investors’ sentiment.