The phrase "accumulating foreign exchange" is correct and usable in written English.
It can be used in contexts related to finance, economics, or international trade, particularly when discussing the process of gathering or increasing foreign currency reserves.
Example: "The country's central bank has been accumulating foreign exchange to stabilize its currency against fluctuations in the global market."
Alternatives: "gathering foreign currency" or "building foreign reserves."
They know they have to buy lots more U.S. Treasuries if they continue accumulating foreign exchange reserves.
Most of the cheap money flowing into the United States came from foreign governments (not the private sector) accumulating foreign exchange reserves and other official assets.
Thus, in 29 sub-Saharan countries between 1999 2005, the IMF permitted, on average, just 27 cents of every incremental dollar in foreign assistance to be used for programme expenditures, with the balance used for paying down domestic debt and accumulating foreign exchange reserves.
"With a more flexible exchange rate regime, we expect to see further liberalization of the capital account and less need for China to accumulate foreign exchange reserves over the medium term," said Jianguang Shen, an economist for Mizuho in Hong Kong.
More typically, countries intervene by selling their own currencies and accumulating foreign-exchange reserves.
The central bank could stop accumulating foreign-exchange reserves at such a pace.
By pumping $45 billion of its massive $400 billion of accumulated foreign-exchange reserves into the banks, China seems to be making effective use of a ready pool of funds, currently parked in relatively low-yielding assets.
JPMorgan's index of local-currency government bonds, the GBI-EM Global Diversified, was still up by 3% for the year on September 13th.Scarred by the crises of the past, many emerging economies have accumulated foreign-exchange reserves, quelled asset bubbles as best they can and kept a lid on their debts, both public and private.
The Asian countries may not have cut back much on their overall debt burden, but at least short-term external-debt obligations are more than covered by huge accumulated foreign-exchange reserves.
At the same time, the phenomenon of higher productivity has made the U.S. a more attractive place for other countries to invest their current account surpluses, the result of their greater propensity to save, export and accumulate foreign exchange reserves.
Analysts say that China can also buy bonds in the European and Japanese markets but that those two markets are not big or liquid enough to absorb China's fast-accumulating foreign exchange reserves.
