China November forex reserves fall more than expected to $3.05 trillion, lowest since 2011

09-Dec-2016 Intellasia | Reuters | 6:00 AM Print This Post

China’s foreign exchange reserves fell for a fifth straight month in November and by more than expected to the lowest since March 2011, as authorities struggled to shore up the sliding yuan currency in the face of a relentlessly rising dollar.

Reserves fell by $69.06 billion last month to $3.052 trillion, central bank data showed on Wednesday, following a drop of $45.7 billion in October.

Economists polled by Reuters had expected reserves to drop $30 billion to $3.091 trillion, from $3.121 trillion at the end of October.

The central bank is widely believed to have sold US dollars to support the yuan currency as it sunk to more than 8-1/2 year lows in November.

China has announced a string of measures in recent weeks to tighten controls on money moving out of the country, adding to market speculation that potentially destabilising capital outflows are on the rise. nL4N1DU2AZ]

The yuan’s more than 5 percent slide so far this year has sparked a flurry of bets that the currency will weaken further, leaving traders wondering how long China’s leaders can maintain their yuan defence and withstand a prolonged drain on reserves if the US dollar continues to firm.

Adding to pressure on the currency, US President-elect Donald Trump has vowed to label China a currency manipulator on his first day in office on January 20 and has threatened to impose huge tariffs on imports of Chinese goods.

China’s gold reserves fell to $69.785 billion at end- November from $75.348 billion at end – October

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Category: China

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