In a narrow sense, foreign exchange reserve is an important part of a country's economic strength, and it is a foreign exchange accumulation used by a country to balance international payments, stabilize exchange rates and repay foreign debts.
Broadly speaking, foreign exchange reserves refer to assets denominated in foreign exchange, including cash, foreign bank deposits and foreign securities. Foreign exchange reserve is an important part of a country's international liquidity, which has an important influence on balancing international payments and stabilizing exchange rate.