China sees 2nd month of net forex sales in Dec

Updated: 2012-01-21 22:47


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BEIJING - Chinese banks sold more foreign currency than they bought from clients in December, reflecting that companies and individuals have become more willing to hold foreign currencies, the country's foreign exchange authority said Saturday.

Chinese lenders bought $142.5 billion on behalf of clients in December, while they sold $157.8 billion, marking the second monthly deficit, the State Administration of Foreign Exchange (SAFE) said in a statement on its website.

The December deficit stood at $15.3 billion, up from $800 million recorded in November.

The SAFE data came after the central bank said earlier this month that the country's yuan funds outstanding for foreign exchanges fell to 25.36 trillion yuan in December, the third monthly decline.

Analysts said the deficit, like falling yuan funds, was a result of a narrowing trade surplus, a slowdown in the growth of foreign direct investment and weakened expectation for yuan's appreciation.

Last year, Chinese banks bought $1.6 trillion in foreign currency, and sold $1.23 trillion, leading to a surplus of $367.8 billion, the SAFE said in the statement.