Q: The latest data disseminated by the People's Bank of China on foreign exchange reserves show that China's foreign exchange reserves at the end of September 2018 dropped by USD 22.7 billion month on month. Could you tell us why such a change occurred? What would you say about the future trends of foreign exchange reserves?

A: As at the end of September 2018, China's foreign exchange reserves recorded USD 3.087 trillion, down by USD 22.7 billion or 0.7% month on month.

In September, China's foreign exchange market performed stably and the foreign-related transactions of market participants are rational and orderly. On the global financial markets, the US Dollar Index basically remained unchanged from the end of August, because the exchange rate of major non-USD currencies witnessed both rising and falling and the prices of major national bonds fell slightly. Due to the combined impact of exchange rate translation and asset price changes, China’s foreign exchange reserves fell slightly.

In the year to date, in the face of complex external environment, China adhered to the general work guidelines of making progress while maintaining stability, and deepened reform and opening up. As a result, the economy maintained overall stability and gained momentum for growth, the economic structure was constantly optimized, the two-way fluctuation resilience of RMB exchange rate was continuously strengthened, the balance of payments maintained basic equilibrium, and China’s foreign exchange reserves remained stable.

Looking ahead, although the external environment still contains great uncertainty, China's economy has a strong capability of adapting to and resisting external risks, and the sound fundamentals will continue to provide a solid foundation for the smooth operation of the foreign exchange market. Under such factors at home and abroad, China's foreign exchange reserves are expected to stay stable amid fluctuations.