China's September forex reserves fall to $3.092 trillion - Ester Holdings

China’s September forex reserves fall to $3.092 trillion

China’s foreign exchange reserves fell more than expected in September despite the yuan rebounding from its biggest monthly drop in 25 years in August amid a cooling domestic economy and rising Sino-U.S. trade tensions.

The country’s foreign exchange reserves – the world’s largest – fell $14.8 billion in September to $3.092 trillion, according to data from the country’s foreign exchange regulator Sunday.

Economists polled by Reuters had expected reserves would fall by $6 billion from August to $3.101 trillion.

The fall in September was due to fluctuations in foreign exchange rates and in the price of assets, the foreign exchange regulator said in a statement after the data release.

Looking ahead, uncertainties in the international economic and financial environment will increase, with the global economy slowing, and trade protectionism and unilateralism on the rise, according to the same statement. Volatility in international financial markets will increase.

China has been able to keep capital outflows under control over the past year despite an escalating trade war with the United States and weakening economic growth at home.

Reserves have rebounded from an October 2018 low thanks to capital controls and rising foreign investments in Chinese stocks and bonds.

In September, the yuan CNY=CFXS rose 0.14% against the dollar after posting its biggest monthly drop in 25 years in August.

The yuan has now depreciated about 11% against the dollar since the two sides began exchanging tit-for-tat tariffs in April last year. []

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