Briefly describe the definition and characteristics of international reserves

International reserve refers to the general term for all internationally accepted liquid assets held by countries** to cover the balance of payments deficit, maintain exchange rate stability, and meet other emergency payment needs.

International reserve assets generally must have three conditions at the same time: availability, liquidity, and universal acceptance.

1. A country's financial authorities must have unconditional access to such assets;

2. The asset must have a high degree of liquidity;

3. The asset must be universally accepted internationally.

1. Definition of international reserves: International reserves, also known as "official reserves", are all assets held by a country's monetary authority that are accepted among the international community for international payments, balance of payments and maintain its currency exchange rate.

International reserves are one of the important issues in the reform of the post-war international monetary system, which not only affects the ability of countries to adjust their balance of payments and stabilize exchange rates, but also affects the world price level and the development of international prices.

2. Characteristics of international reserves:

1) Official holding: that is, the assets that are used as international reserves must be directly controlled and used by the monetary authority, and this direct "grasping" and "use" can be regarded as a "privilege" of the monetary authority of a country.

Assets such as foreign exchange held by non-official financial institutions, enterprises and private individuals cannot be counted as international reserves. This feature makes international reserves known as official reserves and distinguishes them from international liquidity.

2) Free convertibility: that is, assets that are international reserves must be free to be exchanged with other financial assets.

The exchange fully reflects the international nature of reserve assets.

Without free convertibility, the value of reserve assets cannot be realized, and such reserve assets cannot be universally accepted internationally and cannot be used to cover the balance of payments deficit.

and other roles.

3) Sufficient liquidity: that is, the assets used as international reserves must be assets that can be used at any time, such as current foreign exchange deposits deposited in the bank, valuable foreign exchange deposits, etc.

When a country's balance of payments is unbalanced or its exchange rate fluctuates excessively, these assets can be used to balance the balance of payments or intervene in the foreign exchange market to maintain the stability of the national currency exchange rate.

4) Universal acceptance: that is, as an international reserve asset, it must be able to be universally recognized, accepted and used by all countries in the world. A financial asset cannot be called an international reserve asset if it is accepted and used only in a small area or region, although it is also convertible and fully liquid.

International reserves, also known as "international reserve assets". It refers to the monetary assets officially held by a country that can be used for international payments and can maintain the exchange rate of the national currency.

It is mainly composed of the following parts: officially held **; officially held freely convertible currency; Reserve assets and special drawing rights in the International Monetary Organization**.

After the Second World War, the US dollar, the British pound and other major Western currencies became freely convertible. At present, the US dollar is still the most used in the balance of payments. The freely convertible portion of international reserves is vulnerable due to the possibility of fluctuations in the exchange rates of national currencies in the international financial markets.

International reserves are characterized by availability, liquidity, and universal acceptance.

1. A country's financial authorities must have unconditional access to such assets;

2. The asset must have a high degree of liquidity;

3. The asset must be universally accepted internationally.

1) There must be a good adjustment mechanism to correct the imbalance in the balance of payments of various countries; This requires: – Minimal loss of all adjustments – Fair and reasonable assumption of regulatory responsibilities by all countries.

2) The international reserves should be under international control, with the growth of world production and international reserves;

3) Have a stable international currency issuance base and have confidence in the international reserve currency.

1. Acquisition, acquisition includes two aspects.

1) a country acquires ** domestically and concentrates it in the hands of ** banks;

2) A country's **bank buys ** in the international financial market. However, due to the fact that the use value of ** in the daily economic transactions of countries is not large, and the production of ** is also limited, the proportion of ** in international reserves generally does not increase.

2. The surplus of the balance of payments and the surplus of the balance of payments also include two aspects:

1) Current account surplus in the balance of payments.

It is the main international reserve**. The most important of this surplus is the ** surplus, followed by the labor surplus.

2) Surplus in the capital account in the balance of payments.

It is an important addition to international reserves**. At present, international capital flows are frequent and large-scale, and when the outflow of borrowed capital is greater than the outflow of borrowed capital, a surplus in the capital account is formed. If there is no current account deficit at this time, these surpluses form international reserves.

3. Intervene in foreign exchange.

** As a result of bank intervention in the foreign exchange market, a certain amount of foreign exchange can also be obtained, thereby increasing international reserves. When a country's currency exchange rate is affected by supply and demand and has an upward trend or has risen, the country's ** banks will often conduct open market operations in the foreign exchange market, sell their own currency, and buy foreign exchange, thereby increasing the country's international reserves.

1. Acquisition, a country acquires from the domestic market and concentrates on the bank.

Hands; A country's **bank buys** in the international financial market.

2. Surplus in balance of payments and surplus in balance of payments.

As the main ** of international reserves. The most important of this surplus is the ** surplus.

The second is the labor surplus.

3. Intervention in foreign exchange, foreign exchange obtained by the market, and the result of bank intervention in the foreign exchange market can also obtain a certain amount of foreign exchange, thereby increasing international reserves.

4. For foreign borrowing, a country's monetary authority can borrow directly from the international financial market or international financial institutions to replenish foreign exchange reserves.

First, the balance of payments surplus, second, the foreign exchange intervention activities carried out by ** banks in the foreign exchange market in response to the appreciation of the national currency; 3. Withdrawal authority allocated by the International Monetary Organization, 4. Bank Purchase**; 5. The net amount of foreign borrowing by a country** or ** bank.

Reference: Yangcai.com.

Summary. Hello dear, the importance of international reserve management lies in safeguarding the country's foreign exchange reserves and financial stability. Foreign exchange reserves are the country's foreign exchange assets, they are generally held by the central bank, and can be used to support currency issuance, maintain exchange rate stability, respond to domestic economic risks and respond to international financial crises.

Thus, an effective international reserve management policy can guarantee the security and stability of a country's currency and finance. In addition, international reserves can also create credibility and influence for the country, and improve the country's international status and competitiveness. Having sufficient foreign exchange reserves allows the country to deal with international and financial diplomacy more confidently, establish a good international credibility and reputation, and attract foreign capital and international investors.

In conclusion, international reserve management is an important national strategy, especially for countries with a high degree of economic openness and strong external and financial ties.

Hello dear, the importance of international reserve management lies in ensuring the foreign exchange reserves and financial stability of the Guozu family. Foreign exchange reserves are the country's foreign exchange assets, which are generally held by the central bank and can be used to support currency issuance, maintain exchange rate stability, respond to domestic economic risks and respond to the international financial crisis. Thus, an effective international reserve management policy can guarantee the security and stability of a country's currency and finance.

In addition, international reserves can also create credibility and influence for the country, and improve the country's international status and competitiveness. Having sufficient foreign exchange reserves allows the country to deal with international and financial diplomacy more confidently, establish a good international credibility and reputation, and attract foreign capital and international investors. In conclusion, international reserve management is an important national strategy, especially for countries with a high degree of economic openness and strong external and financial ties.

Features: 1. Major adjustments have been made to the statistical caliber of foreign exchange reserves.

2. Foreign exchange reserves account for a large proportion of the reserve asset structure.

3. Foreign exchange reserves show an increasing trend in fluctuations.

4. International reserves are mainly surplus and surplus of direct investment projects.

Principles: 1. Diversify reserve currencies to reduce possible losses caused by exchange rate changes.

2. Determine the proportion of the currency in the reserve currency according to the needs of external payments.

3. Adjust the currency structure of the reserve currency at any time according to the trend of exchange rate movement in the foreign exchange market.

Stable, balanced, rational and orderly.

Regarding the situation of China's international reserves in 2019, it is summarized or evaluated in eight words, 'stable, balanced, rational and orderly'. "Stability" is mainly manifested in the fact that the RMB exchange rate remains basically stable in a reasonable equilibrium.

"Balance" mainly refers to the basic balance of supply and demand in the foreign exchange market, "rationality" is reflected in the more rational cross-border investment, financing, foreign exchange settlement and sales behavior of foreign exchange market entities, and "orderly" mainly refers to a more healthy and orderly foreign exchange market.

Stable, balanced, rational and orderly.

Regarding the situation of China's foreign exchange market in 2019, it is summarized or evaluated in eight words, 'stable, balanced, rational and orderly'. "Stability" is mainly manifested in the fact that the RMB exchange rate remains basically stable in a reasonable equilibrium.

"Balance" mainly refers to the basic balance of supply and demand in the foreign exchange market, "rationality" is reflected in the more rational cross-border investment, financing, foreign exchange settlement and sales behavior of foreign exchange market entities, and "orderly" mainly refers to a more healthy and orderly foreign exchange market.

The characteristics of China's international reserves are:

** Stable reserves;

The growth of foreign exchange reserves is characterized by twists and turns.

The reserve position and SDR of the IMF do not occupy a significant position in our international reserves;

The role of our international reserves is becoming more and more comprehensive.

Answers]: b, c, e

International reserves refer to the monetary assets held by a country's currency authorities and generally accepted by countries around the world, including reserves, foreign exchange reserves, reserve positions in organizations and SDRs.

Answer]: Characteristics of China's international reserve composition: For a long time, China has been pursuing a stable reserve policy; Foreign exchange reserves are the most important part of China's international reserves, and their scale is constantly expanding; In China's international reserves, the proportion of the IMF's reserve position and special drawing rights is very small. Remorse.

International reserves refer to all internationally acceptable assets owned by a country that can be used at any time to cover the balance of payments deficit and maintain the exchange rate of the national currency.

An asset becomes an international reserve when it has all three of the following characteristics:

Availability, i.e., whether it can be repented of at any time and conveniently by a country's monetary authority.

Liquidity, i.e. whether the asset is readily available.

Generally acceptable, i.e. whether it is generally accepted in the foreign exchange market or when settling balances in the balance of payments.

Composition of international reserves:

Reserves: Refers to those held by a country's monetary authority as financial assets.

Foreign exchange reserves: refers to the external liquidity assets held by the monetary authorities of various countries.

Reserve Position Socks: It is the automatic withdrawal right of a country in the International Monetary Organization**.

Special Drawing Right: A book asset allocated by the International Monetary Organization to member countries for the repayment of loans to the organization and the repayment of balance-of-payments deficits between member countries.

Function: 1. It plays a buffering role when a country has difficulties in the balance of payments.

2. It is used to intervene in the foreign exchange market and stabilize the local currency exchange rate.

3. It can be used as the last credit guarantee for the repayment of principal and interest of foreign debts, and helps to improve international credit.