Q: The latest foreign exchange reserve data from the State Administration of Foreign Exchange (SAFE) shows that China's foreign exchange reserves for October 2019 grew by USD 12.7 billion month-on-month. Could you explain why there is such a change? What would you say about the future trends?

A: As at the end of October 2019, China posted USD 3.1052 trillion in foreign exchange reserves, up by USD 12.7 billion or 0.4% month-on-month.

China's foreign exchange market performed stably in October. Under the combined impacts of the global trade situations, monetary policies of major central banks and the prospects of Brexit, the US Dollar Index declined and bond prices of major countries dropped. Further, due to exchange rate conversion and asset price changes, China's foreign exchange reserves increased.

In the year to date, despite dramatic increases in risks and challenges in global markets, China's economy has maintained stability while achieving progress, with major indicators meeting expectations and structural adjustment stably advanced. As a result, China's cross-border capital flows remained steady, the supply and demand in foreign exchange markets were in a basic equilibrium and foreign exchange reserves rose stably.

Looking ahead, as the world economy slows down, the global financial market will continue to be faced with numerous destabilizing factors and uncertainties. But China's economic fundamentals and its long-term positive trends have not changed, with efforts on reform and opening up increased, momentum for organic growth strengthened and resilience against risks and challenges enhanced, which lay a solid foundation for the overall stability of China's foreign exchange reserves.