Chinese banks’ forex settlement deficit narrows in Dec

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BEIJING: China’s commercial banks reported a drop in their forex settlement deficit in December, official data showed.

Forex purchases by banks stood at 1.14 trillion yuan ($167.7 billion) last month, while sales reached 1.19 trillion yuan, resulting in a deficit of 48.8 billion yuan, according to data from the State Administration of Foreign Exchange (SAFE).

This narrowed from a November deficit of 124.1 billion yuan, according to SAFE data. The Chinese banks’ forex settlement deficit hit 56 billion U.S. dollars in 2018, shrinking 50 per cent from 2017.

“The figures show that cross-border capital flows remain generally stable, while forex market supply and demand are basically balanced,” said SAFE spokesperson Wang Chunying.

She said the country’s forex market had remained stable despite a complex environment last year and would maintain the trend in 2019.

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