China is closely watching the US Federal Reserve, the country’s foreign exchange regulator said on Friday, adding that foreign debt was stable amid widespread volatility.
The State Administration of Foreign Exchange (SAFE) said China’s foreign debt was expected to maintain “reasonable and orderly” development.
The yuan would keep stable at balanced levels in the second half of this year, SAFE said, adding that the regulator would monitor the pace of Fed policy adjustments.
At the end of June, China’s foreign exchange reserves stood at $3.0713 trillion, down by $56.5 billion, or 1.8%, from the end of May.
SAFE said international financial markets were under the influence of the monetary policies and inflation expectations of major countries, global economic growth prospects, and other factors.
“The current global economic slowdown, together with the stubbornly high inflation and the increasingly volatile international financial market, led to a more complex and severe external environment,” SAFE said.
“However, China has effectively coordinated [Covid-19] pandemic prevention and control with economic and social development,” it added.
- Reuters, with additional editing by George Russell