China FX reserves rise more than expected to $3.117T in Nov

BEIJING  – China’s foreign exchange reserves rose more than expected in November, central bank data showed on Wednesday, as the dollar weakened against other major currencies.

The country’s foreign exchange reserves – the world’s largest – rose $65.1 billion to $3.117 trillion last month, compared with $3.10 trillion tipped by a Reuters poll of analysts and $3.052 trillion in October.

The State Administration of Foreign Exchange (SAFE) said in a statement that the increase in November reserves came amid the weakening dollar and rising prices of global financial assets.

The yuan rose about 3 percent against the dollar in November, while the dollar last month fell 5.1 percent against a basket of other major currencies.

After a sharp slide earlier in the year, China’s yuan has recently recovered some ground against the U.S. dollar, which came under pressure after the Federal Reserve Chair Jerome Powell said the pace of U.S. rate hikes could be scaled back “as soon as December”.

The yuan has also been bolstered by optimism that China is making a gradual shift away from its zero-COVID strategy and towards the reopening of its economy.

China announced on Wednesday the most sweeping changes to its tough anti-COVID regime since the pandemic began three years ago, loosening rules that curbed the spread of the virus.

The data also showed China held 63.67 million fine troy ounces of gold at the end of November, up from 62.64 million ounces at end-October, the first change since September 2019.

The value of China’s gold reserves rose to $111.65 billion at the end of November from $102.67 billion at end-October.