An asset held by a country or economy and readily convertible to another country, usually calculated in terms of.
They are also known as reserves, where governments keep reserves of non-domestic currencies over the years to be used primarily to manage the value of their own currencies.
Not all national currencies can act as international reserve assets. Only currencies that are important in the system and freely convertible to other reserve assets can act as international reserve assets.
The foreign exchange reserves often used by China and other countries in foreign trade are mainly dollar, etc.
A certain amount of foreign exchange reserves is an important means for a country to conduct economic regulation and achieve internal and external balance.
When there is a deficit in the balance of payments, the use of foreign exchange reserves can promote the balance of payments;
When the domestic macro economy is unbalanced and the total demand is greater than the total supply, foreign exchange can be used to organize the import, so as to adjust the relationship between the total supply and the total demand and promote the balance of the macro economy.
At the same time, when there are fluctuations, foreign exchange reserves can be used to intervene the exchange rate to stabilize it.
Therefore, foreign exchange reserve is an indispensable means to achieve economic balance and stability, especially in the context of the continuous development of economic globalization, a country’s economy is more vulnerable to the economic impact of other countries.
Risk sentiment improved, the dollar retreated gold below 1930, oil rose above 115.
Please pay attention to the specific operation, the market is changing rapidly, investment needs to be cautious, the operation strategy is for reference only.
