China Jan forex reserves rise more than expected to $3.184 trln

China’s foreign exchange reserves rose $56.8 billion to $3.184 trillion in January, official data showed on Tuesday, as the dollar fell against other major currencies and global financial asset prices rose.

The country’s foreign exchange reserves – the world’s largest – rose from $3.128 trillion in December. The rise was more than expected. A Reuters poll of analysts had forecast reserves totalling $3.152 trillion for January.

The yuan CNY=CFXS rose 2.2% against the dollar in January, while the dollar fell 1.4% against a basket of other major currencies =USD.

“China’s economy continues to recover, showing a rebound trend, and the endogenous driving force continuously strengthens, which is conducive to keeping foreign exchange reserves basically stable,” the foreign exchange regulator said in a statement.

China’s foreign exchange reserves fell $112.5 billion in 2022, when the yuan dropped 7.9% against the dollar, its biggest annual drop since 1994.

The Chinese currency has rebounded this year, as the dollar weakens and China’s economy picks up following an abrupt abolition of stringent COVID curbs in early December.

China held 65.12 million fine troy ounces of gold at the end of January, up from 64.64 million ounces at the end of December, central bank data showed.

The value of China’s gold reserves rose to $125.28 billion at the end of January, from $117.24 billion at the end of December.
Source: Reuters (Reporting by Albee Zhang and Kevin Yao; Editing by Simon Cameron-Moore)