The State Administration of Foreign Exchange (SAFE) has recently released the data on foreign exchange settlement and sales by banks and foreign-related receipts and payments by banks for customers for April 2020. Wang Chunying, press spokesperson and chief economist of the SAFE, answered media questions on foreign exchange receipts and payments for April 2020.

Q: What were the changes in foreign exchange receipts and payments for April 2020?
A: Overall, China's foreign exchange market remained steady in April.
The supply and demand were in balance in the foreign exchange market and foreign exchange reserves remained stable. First, foreign exchange settlement and sales by banks remained in surplus. In April, foreign exchange settlement and sales by banks recorded a surplus of US$ 14.8 billion, including a surplus of US$ 12 billion in foreign exchange settlement and sales by banks for customers. China's foreign exchange market was in a basic equilibrium in terms of supply and demand, when other supply and demand factors like forward foreign exchange settlement and sales and options were considered. Second, foreign-related receipts and payments of the non-banking sectors registered a net inflow again. In the month, China's non-banking sectors including enterprises and individuals posted a surplus of US$ 4.9 billion in foreign-related receipts and payments, versus a deficit for March. Third, China's foreign exchange reserves rose steadily. By the end of April, China registered US$ 3.0915 trillion in the balance of foreign exchange reserves, representing an increase of US$ 30.8 billion from that of the end of March.
Market players' expectations stayed steady and cross-border capital flows increased stably. First, market players maintained a stable desire to settle foreign exchange but a weakening desire to buy foreign exchange. In April, the foreign exchange settlement rate, a measure of customers' desire to settle foreign exchange, or the ratio of foreign exchange sold by customers to banks to customers' foreign-related foreign exchange receipts, reached 66%, consistent with that of the first quarter. The foreign exchange sales rate, a measure of market players' desire to purchase foreign exchange, or the ratio of foreign exchange purchased by customers from banks to customers' foreign-related foreign exchange payments, was 61%, down by 2% from that of the first quarter. Second, China posted a net inflow of cross-border capital through major channels. In April, cross-border receipts and payments under trade in goods registered a surplus of US$ 13.5 billion, up by 76% year on year; and a net inflow of cross-border capital was resumed under securities investments. In particular, foreign investors increased their holdings of China's bonds and listed shares by US$ 18.9 billion net.
China's epidemic response continues to yield positive changes, with resumption of work and production being accelerated and the economy recovering and returning to normalcy, playing a critical role in stabilizing market expectations and boosting market confidence. China's economic fundamentals are sound and stable, and will remain so over the long term, China's confidence and determination to stay committed to opening its door wider to the world have not been changed, and the reform of cross-border trade and investment liberalization and facilitation has been deepened, which have laid a foundation for the stable performance of China's foreign exchange market. On the other hand, China's foreign exchange market is maturing and has shown strong resilience and stability under the COVID-19 epidemic, with market expectations staying generally stable, which are also helpful for maintaining basic stability in China's foreign exchange market.