China's Foreign Exchange Market Remains Steady; July Bank Forex Settlement Surplus Hits US$18.3 Billion

On the 17th, reporters learned from the State Administration of Foreign Exchange (SAFE) that in July 2026, banks purchased foreign exchange worth US$266.3 billion and sold US$248 billion, posting a foreign-exchange settlement and sales surplus of US$18.3 billion. Enterprises conducted settlement and sales rationally according to actual demand and market conditions, and forex market supply and demand were basically balanced. Industry experts believe that, overall, against a complex and changing external environment, China's foreign-related receipts and payments have steadily expanded, cross-border capital flows have remained balanced, and—taking into account improving foreign-trade momentum and other factors—the stable operation of the foreign-exchange market is expected to continue.

"Since July, the external environment has become more complex and volatile, geopolitical uncertainty has risen, and international financial markets have continued to fluctuate," said Li Bin, deputy administrator of SAFE and spokesperson. "China's foreign-exchange market has remained stable, foreign-related receipts and payments have expanded steadily, market expectations have generally remained stable, and foreign-exchange transactions have been rational and orderly."

Specifically, forex market supply and demand remained basically balanced. In July, banks recorded a settlement and sales surplus of US$18.3 billion.

Zhao Qingming, vice president of the Hui Guan Research Institute, believes that the July bank settlement and sales surplus is in line with market expectations and no unanticipated one-sided movements have occurred.

"On the one hand, China's foreign trade has long demonstrated strong resilience; the goods-trade account has continued to run a surplus, providing stable supply to the domestic foreign-exchange market and fundamental support for the settlement surplus. On the other hand, the RMB exchange rate has remained two-way fluctuating and generally stable, and enterprises generally exhibit behavior such as 'settling foreign exchange early, delaying purchases, and postponing overseas payments,' which helps keep forex supply and demand balanced," Zhao said.

From the perspective of foreign-related transaction scale, in July, cross-border receipts and payments of non-bank sectors such as enterprises and individuals totaled US$1.7 trillion, up 20% year on year; forex market turnover reached US$4.3 trillion, up 8% year on year—both at high levels. In terms of cross-border capital flows, net inflows of non-bank sectors stood at US$59.8 billion in July. Among them, net inflows under the goods-trade account remained high, while outflows under services trade, foreign-funded enterprise profit distributions and other items stayed steady.

"Overall, current forex market supply and demand remains broadly balanced. Although the RMB exchange rate is two-way fluctuating, the amplitude is moderate and stability is prominent. The foreign-exchange market is expected to continue running in a stable and orderly manner," Zhao said.

Source: Economic Information Daily