China's forex purchase position up in May

BEIJING - China's forex purchase position reached 27.430 trillion yuan ($4.44 trillion) at the end of May,marking the sixth straight month of rises, the People's Bank of China, or PBOC, announced Friday.

The figure resulted in a net increase of 66.86 billion yuan in May from April's forex purchase position of 27.363 trillion yuan, according to the bank.

The May purchase figure was down from April's 294.35 billion and the average 315.3 billion during the first four months of the year, indicating a falling trend in the volume of capital inflows, PBOC data showed.

China has witnessed accelerated capital inflows since major economies launched monetary easing policies.

Net foreign exchange purchases totaled 1.22 trillion yuan in the first three months, more than double last year's total.

China's foreign trade volume grew 0.4 percent year-on-year in May to $345.1 billion, down from the 15.7-percent gain seen in April, according to the General Administration of Customs.

Experts believed that the slow growth of foreign trade is partly due to government rules to curb capital inflows disguised as trade payments.

The State Administration of Foreign Exchange, China's top forex regulator, announced in May that it would step up controls on capital inflows. These include stricter checks on mismatches between cargo and cash flows and increased oversight of current account transactions, effective from June 1.

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