Asia – China and India face a decline in foreign exchange or forex reserves. China drops to $3.029 trillion, while India drops to $532.66 billion. On a side note, Financial Commission or FinComm forex traders will receive their third-quarter compensation for 2022.
China experienced a drop in the forex reserves, yet it’s within a controllable range. This drop will not change the trend of the country’s reserves, wherein the trend stays stable, according to trade experts.
Nonetheless, experts emphasized the need for policymakers in China to improve domestic financial momentum and avoid any severe and illogical failing of the renminbi. The weakening might threaten the reserves’ safety.
When the year started, there was already a decrease of 6.8% in the forex reserves of this country, which amounted to $221.2 billion. It dropped by $25.9 billion further, and now, it’s at $3.029 trillion by the end of September. This drop was the lowest in over five years, and it’s because of the fall in global economic markets and the United States or the US dollar.
The decrease in China’s reserves resulted in a bigger drop in the global foreign currency reserves. The recorded drop was around $1 trillion, or that’s 7.8%, as per Bloomberg.
According to experts and officials, the US dollar deflated the country’s reserves as it denominates in other currencies. On the other hand, the economy continues to improve, having flexibility despite unbalanced external factors. It helps in keeping the forex reserves become stable.
India also dropped to $532.66 billion in the last week of September, the lowest level. The decline was continuous for nine weeks since the forex reserves were at $537.52 billion last week. Aside from the 82 per dollar, the Reserve Bank of India (RBI) interfered with capturing the pace of the rupee’s fall.
On a side note, FinComm, an independent EDR or External Dispute Resolution body for the foreign exchange industry, gave compensation to forex traders. The compensation increased to $79,494 at the end of Q3. There was also an increase in the number of resolved complaints by 4%, totaling 781 complaints. The value of new complaints ranges between $1,000 and $1,000.
As per FinComm, the complaints filed by forex traders spiked by 5%, equivalent to 809 complaints. The self-regulatory group added that the return from brokers increased by 51%, which is $3.4 million, while the average value of complaints was boosted by 45%, which is $4,266.
On the other hand, FinComm only accounted for trading-related complaints, which is 11.7% of the entire complaints gathered for Q3. Most of the complaints are about funds withdrawal and account blockage.
