China’s foreign exchange reserves up US$3.5 billion in August despite yuan drop
- Total rises beyond analysts’ forecasts to US$3.1072 trillion, according to central bank figures released on Saturday
- Increase from July due to stable balance of international payments and generally stable economic growth, regulator says
China’s foreign exchange reserves rose unexpectedly in August, even as the yuan posted its biggest monthly drop in 25 years amid escalating trade tensions with the United States.
The country’s forex reserves – the world’s largest – rose by US$3.5 billion from the previous month to US$3.1072 trillion, according to figures released on Saturday by the central bank.
Economists polled by Reuters had expected the total to fall by US$4 billion from July to US$3.1 trillion, largely due to fluctuations in global exchange rates and the prices of foreign bonds that China holds.
China’s foreign exchange regulator said the increase in August was due to the country maintaining a stable balance of international payments and generally stable economic growth. Bond prices in major countries also rose, it said.
China has been ramping up its gold reserves this year. It held 62.45 million fine troy ounces at the end of August, up 4.85 per cent from 59.56 million ounces at the end of last year.
The value of its gold reserves rose to US$95.45 billion at the end of August from US$87.876 billion at the end of July.