China’s foreign exchange reserves dropped to $3.201 trillion at the end of July, down from June’s 3.205 trillion, the People’s Bank of China, the central bank, said on Sunday.
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China’s central bank will continue to adopt the prudent monetary policy in the second half of the year, while maintaining an appropriate degree of flexibility and making timely pre-emptive adjustments, state media reported Friday.
A woman walks past the headquarters of the People’s Bank of China (PBOC), the central bank, in Beijing, June 21, 2013.
Although the Yuan has returned to stability and capital outflow has also been curbed this year, economists are still not convinced.
The focus in the last five months of the year is expected to be on structural reform and fiscal measures to boost growth.
Economists are divided over how much money is still flowing out of the country via other channels, with opaque policymaking and some inconsistency in the data raising suspicions that the fall in the yuan may be masking capital outflow pressure.
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Its exchange rate composite index, which measures yuan’s strength relative to currencies including the US dollar, euro and Japanese yen, came in at 95.34 at the end of July, from 95.02 a month earlier, according to financial services provider China Foreign Exchange Trade System. The growth has remained within the government’s full year target of 6.5-7 percent. The economy grew 6.7% in the first half.
