Impact of cross-border capital flows on foreign exchange market stability.

• Enriches the related research on cross-border capital flows. • The impact of cross-border capital flows in different cycles is analysed. • The asymmetric impact of cross-border capital fluctuations is made explicit. This study explores the impact of cross-border capital flows on foreign exchange market stability. The research reveals that, in the long term, depreciation pressures arising from the withdrawal of cross-border capital inflows outweigh appreciation pressures arising from increased cross-border capital inflows. The impact of positive changes in cross-border capital outflows is significantly more significant than that of negative changes. [ABSTRACT FROM AUTHOR]