The State Administration of Foreign Exchange (SAFE) has recently released the preliminary data in the Balance of Payments for the second quarter and the first half of 2018. Its press spokesperson has answered media questions on relevant issues.

Q: Could you brief us on the new characteristics of the balance of payments for the second quarter of 2018, relative to the first quarter?

A: The preliminary data in the Balance of Payments for the second quarter show that China's BOP maintained a basic equilibrium and reserve assets rose. Below are the new characteristics:

First, the current account was in surplus, with a higher surplus under trade in goods, and a stable deficit under trade in services. In the second quarter, the current account recorded a surplus of USD 5.8 billion, including a surplus of USD 104.2 billion under trade in goods, and a deficit of USD 73.7 billion under trade in services in the Balance of Payments. Transportation, travel and intellectual property fees remained in deficit.

Second, the financial account excluding reserve assets continued to be in surplus, featuring net cross-border capital inflows. In the second quarter, the financial account excluding reserve assets registered a surplus of USD 18.2 billion, and cross-border capital continued with net inflows that started from the first quarter of 2017.

Third, FDI stayed high. In the second quarter, China posted USD 29.9 billion in net inflows of direct investment. ODI recorded net outflows of USD 28.7 billion, and FDI registered net inflows of USD 58.6 billion, which was high.

Fourth, reserve assets increased slightly. In the second quarter, China's reserve assets rose by USD 23.9 billion due to BOP transactions (excluding non-transaction factors like foreign exchange rate and price). Specifically, foreign exchange reserves went up by USD 22.9 billion.

Overall, China's balance of payments maintained a basic equilibrium in the second quarter. It is noteworthy that the receipts and payments under the current account have entered an equilibrium range in recent years, with a slight surplus or deficit counted as a basic equilibrium. Going forward, the balance of the current account is expected to stay within a reasonable range, and the BOP will continue with an overall equilibrium.