china: As such, voices have emerged suggesting that China should interfere at the 3 trillion redline to prevent the reserve from falling further, according to Global Times China. But this is based on a misconception about the function of a country forex reserve. Given the expectation of yuan depreciation in the face of a stronger dollar and ongoing capital outflows, there is a risk that China forex reserve may fall below the 3 trillion mark in coming months. For a long time, the belief has been that the more forex reserve, the better. But in fact, the 3 trillion level has never been the bottom line. The country even prided itself when China forex reserve exceeded the 3 trillion mark in 2011, far ahead of Japan, the world second largest forex reserve holder with 1.3 trillion in foreign reserve assets.
(news.financializer.com). As
reported in the news.
Tagged under china, bottom line topics.