China’s capital account stable

Thursday, 8 March 2018

Via Capital Economics:

PBOC remains on the side-lines, but trade war fears could trigger intervention  China’s foreign exchange reserve figures suggest that the People’s Bank remained a minor player in the FX market last month. But its pledge to allow a more market-driven exchange rate will be tested if the renminbi comes under renewed pressure due to trade tensions or weaker economic growth.

 The value of the reserves amounted to $3,134bn at the end of February, down $27bn from a month earlier (the Bloomberg median was $3,160bn, our forecast was $3,150bn). (See Chart 1.)

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.