China Foreign Reserves at Highest Since 2016 as Trade Booms

A weakening U.S. dollar and a record surplus likely helped China’s forex hoard grow to its most since August 2016.

(Bloomberg) — China’s foreign exchange reserves rose by more than $50 billion in November to the highest since August 2016, likely boosted by the weaker dollar and a trade surplus at record highs.

Reserves gained for the first time in three months, reaching $3.1785 trillion at the end of November, the People’s Bank of China said Monday. The value of gold assets declined to $110.4 billion.

China’s foreign exchange market is expected to be basically stable, the State Administration of Foreign Exchange (SAFE) said in a separate statement. The reserves rose mainly due to changing exchange rates and asset prices, SAFE spokesman Wang Chunying said in a statement, noting that the dollar index had fallen and non-dollar currencies rose in general.

The yuan has already appreciated more than 6% against the dollar this year and is one of the best performers in Asia.

Contact editor Yang Ge (geyang@caixin.com)

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