Chinese banks report net forex purchase

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A worker counts Chinese currency Renminbi (RMB) at a bank in Linyi, east China's Shandong Province, Aug. 11, 2015. [Photo/Xinhua]

Chinese banks saw a net foreign exchange purchase in 2020 as the yuan's exchange rate remained generally stable despite increasing fluctuations, data from the country's forex regulator showed Friday.

Chinese lenders bought 253.7 billion U.S. dollars worth of foreign currencies and sold 187.1 billion dollars worth in December, resulting in a net purchase of 66.6 billion dollars, the State Administration of Foreign Exchange (SAFE) said in a statement.

In 2020, the banks recorded a net forex purchase of 158.7 billion dollars, the data showed.

Despite increasing fluctuations due to changes in the domestic and external macro-environment, the Chinese currency largely maintained stability in the pandemic-ravaged year.

The central parity rate of the yuan averaged 6.8974 against the U.S. dollar in 2020, almost flat with the figure seen in 2019, according to Wang Chunying, deputy head of the SAFE.

"The impacts of the periodic appreciation of the yuan's exchange rate on the balance of payments are within a normal range," Wang noted, adding the foundation for a balanced payment sheet will not easily change.

Earlier data showed China's foreign exchange reserves expanded to 3.2165 trillion U.S. dollars at the end of December as the country's forex market remained generally stable.

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