Q: The latest foreign exchange reserves data released by the People's Bank of China (PBC) show that China's foreign exchange reserves as at the end of July 2017 went up by USD 23.9 billion month on month. Could you brief us on the causes behind such changes in foreign exchange reserves?

A: As at the end of July 2017, China's foreign exchange reserves amounted to USD 3.0807 trillion, up by USD 23.9 billion or 0.8% month on month, recovering 6th-straight month.

In July, China's cross-border capital flows remained stable, indicating a basic equilibrium between the supply and demand of foreign exchange; in global financial markets, non-USD currencies appreciated against the USD, boosting increases in foreign exchange reserves in USD terms.

Since the beginning of this year, China's economy has been stable and improved, thanks to the more favorable factors that support the economy to achieve mid and high-speed growth and step onto the mid and high level. Global financial markets have stayed stable. Cross-border capital flows and the demand and supply of foreign exchange markets have found an equilibrium, and the RMB exchange rate has remained stable. Residents and enterprises have thus become more rational in buying foreign exchange.

Going forward, as the supply-side structural reform goes deeper, and the innovation-driven development strategy is implemented at a faster pace, the positive changes in China's economic performance will continue to increase. Alongside the expansion and opening up of financial markets, foreign exchange markets will sustain healthy development, market expectations will stay stable, and the foundation for stable cross-border capital flows will be solidified, which will provide a further boost to the stability of foreign exchange reserves.