Chinese Banks Show Largest Net Currency Purchases Since January
Yuan positions accumulated from foreign-exchange purchases increased to 25.9 trillion yuan last month from November, data published by the People’s Bank of China showed today. That compares with net sales of 73.6 billion yuan in November and 100.3 billion yuan in December 2011.
The yuan failed to appreciate against the dollar in December for the first time in five months. The central bank said in August that capital flows would be “basically balanced” in the second half of 2012 and the size of any net inflows or outflows would be small.
Data from the PBOC today also showed that China’s foreign- exchange reserves, the world’s largest, increased in each month during the fourth quarter, rising to a record $3.32 trillion in December. That completes a five-month gain, the longest streak since August 2011.
--Scott Lanman. Editors: Scott Lanman, Sunil Jagtiani
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