China's forex growth streak mirrors stabilizing economy: analyst

Continuous growth in China's foreign exchange reserves points to the country's better economic fundamentals and prospects of more gains in capital inflow, an analyst said Tuesday.

China's foreign exchange reserves rose to 3.099 trillion U.S. dollars by the end of March, marking a five-month consecutive increase, data from the State Administration of Foreign Exchange (SAFE) showed.

As China continues to be a key stabilizer of the world economy, its economic fundamentals will be a major influencer of market expectations, said Li Chao, chief analyst of Huatai Securities.

Successive rises in the past five months could be the prelude to a burgeoning trend of capital inflow into China, Li said, adding that China's international balance of payments had reached an equilibrium that left more room for the central bank to manoeuver monetary policy for stable growth and employment.

"We remain staunchly bullish on yuan-denominated assets," Li said.

Commenting on the growth streak, SAFE spokesperson and chief economist Wang Chunying said earlier that China would maintain stable forex reserves with its economy running within a reasonable range despite rising volatility in the global financial market.