BEIJING — China's foreign exchange reserves expanded to $3.1123 trillion at the end of June, official data showed on July 7.

The amount increased by $10.6 billion, or 0.3 percent, from the end of May, according to the State Administration of Foreign Exchange (SAFE).

China's forex market in June reported generally balanced supply and demand, said SAFE spokesperson Wang Chunying.

Wang said the uptick in the scale of forex reserves is affected by multiple factors, including exchange rates and changes in asset prices.

Factors including the global spread of COVID-19 as well as monetary and fiscal stimulus of major economies led to the drop in the US dollar index and the rise in asset prices of major countries, according to Wang.

Wen Bin, chief analyst at China Minsheng Bank, said cross-border capital inflows also contributed to the rise in scale, adding that renminbi assets are attracting more global investors.

Despite a complex external economic environment amid the COVID-19 pandemic, Wang said China's economy, with multiple indicators marginally improved, is shifting towards a good momentum.

China's economy maintains growth resilience, and the fundamentals for its long-term, sound development remain unchanged, providing a solid foundation for the stability of forex reserves, Wang added.

Echoing Wang's remarks, Wen expected the economy to continue to improve amid the country's strengthened counter-cyclical policies.