China's outstanding yuan funds for forex rise in December

BEIJING -- China's outstanding yuan funds for foreign exchange climbed in December 2022 from the previous month, data from the country's central bank showed Monday.

The funds came in at about 21.47 trillion yuan ($3.2 trillion) at the end of December, 93.88 billion yuan more than November, according to the People's Bank of China.

The outstanding funds for foreign exchange have achieved growth for three consecutive months. At the end of November, the funds expanded by 63.6 billion yuan from the previous month.

As the Chinese yuan is not freely convertible under the capital account, the central bank must purchase foreign currency generated by a trade surplus and foreign investment in the country, adding funds to the money market. Such funds are a vital indicator of cross-border foreign capital flows and domestic yuan liquidity.