Translation in English: The US dollar surges across the board, the Chinese yuan

Foreign Exchange Reserves: Steady Increase with Plenty of Confidence

Did you know? By the end of August 2024, our country's foreign exchange reserves have surged to a whopping 3,288.2 billion US dollars, which is an increase of 31.8 billion US dollars from the end of the previous month. This growth rate is almost close to 1%. In layman's terms, it's like "taking small steps quickly and firmly." Why is it so stable? The reasons need to be thoroughly discussed from the inside out.

On September 10, 2024, the central parity rate of the euro to the Chinese yuan in the interbank foreign exchange market was: 1 euro equals 7.3317 yuan.

That is, 1 euro = 7.3317 yuan.

According to today's exchange rate of the euro to the Chinese yuan:

1 euro = 7.875 yuan.

Firstly, we must thank the "lack of competitiveness" of the US Dollar Index. In August, it fell by 2.23%, which is the steepest drop since the beginning of the year. You see, when the US dollar devalues, our non-US dollar assets, such as euros and yen, when converted to US dollars, hey, they increase significantly! We estimate that just this part alone has contributed about 28 billion US dollars to the foreign exchange reserves as a "value-added gift package."

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Furthermore, the global financial market is quite accommodating. As soon as the news of the Federal Reserve's interest rate cut spread, the yield on US Treasury bonds dropped, and bond prices soared. As for the stock market, apart from a slight stumble in the Japanese stock market, the US and European markets are booming with prosperity. As a result, our foreign reserve assets also rise with the tide, making us feel very pleased.

Moreover, our country's exports are truly commendable, maintaining a strong growth momentum, and the trade surplus is as large as a small mountain. Cross-border capital flows are also stable, and the Chinese yuan has appreciated against the US dollar. This series of good news indicates that our country's external economic environment is getting better and better, with a solid economic foundation, naturally giving us plenty of confidence.

Gold Reserves: Seeking Change in Stability, Wise LayoutLet's talk about gold reserves, which are the "hard currency" in our country's treasure trove of wealth. You see, since May, our gold reserves have been as stable as Mount Tai, not moving for four consecutive months. This is not because we don't value gold anymore, but because there is a strategy and a plan behind it.

Think about it, the current gold prices are so high that they are almost touching the ceiling of 2000 US dollars per ounce. If we were to keep buying as aggressively as before, the cost would be astronomical. So, the central bank has wisely decided to take a breather and wait, which allows us to control costs while maintaining flexibility.

However, don't worry, the central bank has a clear plan. In the long run, gold remains an important component of international reserves, and it greatly benefits the optimization of our international reserve structure and the internationalization of the Renminbi. So, when the time is right, the central bank will surely continue to increase its gold holdings, and we will just have to wait and see.

Looking to the future: A more stable purse and a sweeter life

Having said all that, we must look forward. In the coming period, it is highly likely that our country's foreign exchange reserves will remain steadily above the 3 trillion US dollar mark. This is not just a number; it means that our country has enough "ammunition" to deal with various external shocks and risk challenges.

Moreover, as our country's economy continues to rebound positively, exports keep growing, cross-border capital flows remain stable, and the Renminbi exchange rate performs strongly, the pockets of our people will also become fuller and more secure. At that time, we will not only be able to consume and invest with confidence but also better enjoy the dividends brought by the country's development!

So, my friends, we must have confidence in our country and in ourselves! As long as we work together and make joint efforts, our lives will definitely become more prosperous and sweeter!