Cross-border capital flows stable in March: regulator

China’s cross-border capital flows remained basically unchanged in March, official data showed on Thursday. The country's foreign exchange regulator has also announced a slew of measures to boost the local forex market.

Last month, Chinese commercial banks bought 1.01 trillion yuan (US$151.3 billion) worth of foreign currencies and sold 1.05 trillion yuan, resulting in a net sale of 41.2 billion yuan, the State Administration of Foreign Exchange (SAFE) said in a recent statement.

The volume narrowed from the 101.3 billion yuan deficit seen in February.

In the first quarter, lenders recorded an aggregate net forex sale of 60.7 billion yuan, according to the regulator.

SAFE said it would work to further optimize foreign exchange management policies, improve the convenience of fund transfers for foreign-owned enterprises and support qualified and capable domestic companies to carry out “real and compliant” overseas investment, according to Wang Chunying, spokesperson, chief economist and director of the Department of Balance of Payments at the administration.

To attract more foreign players into China’s capital markets, the authority noted that it plans to reform the system for qualified institutional investors, simplify their market access and expand their scope of investment.

“We will reform the QFII and RQFII systems while pushing forward the opening of capital accounts in a steady and orderly way”, Wang added.

China's Qualified Foreign Institutional Investor (QFII) scheme allows approved investors to invest in a limited scope of cross-border securities products, while an RMB Qualified Foreign Institutional Investor (RQFII) scheme permits use of yuan funds raised in Hong Kong by the subsidiaries of domestic fund managers and securities houses in Hong Kong to invest in the domestic capital market.

SAFE said it would welcome more participants, like securities brokers and fund companies, to join the foreign exchange market. It would also support the innovation of forex derivatives and launch more option products in the future.

Meanwhile, efforts will be made to promote channel integration for the opening of the inter-bank bond market, standardize the management of yuan-denominated bonds issued by overseas institutions and push ahead forex reforms in pilot free trade zones, the Guangdong-Hong Kong-Macao Greater Bay Area and Xiong'an New Area.