Balance of payments deficit, also known as balance of payments deficit, means that a country's expenditure on balance of payments is greater than its income. The balance of payments deficit will lead to a decrease in foreign exchange supply (China's supply of foreign currency) and an increase in demand (China's demand for foreign currency) in the domestic foreign exchange market, which will lead to an increase in foreign exchange rate and a decrease in local currency exchange rate. If the government takes measures to intervene, that is, selling foreign exchange and buying local currency, the government does not have enough foreign exchange reserves, which will further lead to the depreciation of the local currency. Government intervention will directly lead to the reduction of domestic money supply, and the reduction of money supply will lead to the increase of domestic interest rates, leading to economic decline and increased unemployment.

Response time: 2021-01-14. Please refer to the latest business changes announced by Ping An Bank in official website.

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