Yuan Photo: Xinhua

 
China's foreign exchange reserves climbed back above $3.1 trillion at the end of November and reached a record single-month foreign exchange reserve increase since November 2013, data released by the State Administration of Foreign Exchange (SAFE) showed.

As of November, China's foreign exchange reserves stood at $3.12 trillion, up $65.1 billion, or 2.13 percent, compared with the end of October, according to SAFE data. 

The SAFE said in a statement on its official website on Wednesday that impacted by global macroeconomic data, monetary policy expectations of major economies and other factors in November, the dollar index fell, while global financial assets prices rose. 

"As a result of combined impact from exchange rate translation, assets price changes and other factors, the scale of foreign exchange reserves rose across the month," the statement read.

In November, the US dollar index fell by about 5 percent. The US dollar depreciated by about 3.9 percent against the yuan. The currency also weakened by about 7 percent against the Japanese yen, according to data from Wind.  

In the context of China's continued rollout of a basket of economy-stabilizing policies and successive policies being fully implemented and taking effect, the overall economy is expected to rebound, which is conducive to keeping the scale of foreign exchange reserves stable. 

"When the US dollar weakens, many other currencies that China holds in foreign reserves appreciate against the greenback, pushing up the total scale up," Xi Junyang, a professor at the Shanghai University of Finance and Economics, told the Global Times on Wednesday.

According to Xi, since the US dollar is burdened with further depreciation pressure next year, in addition to the US’ economic decline, China's foreign exchange reserves will likely increase further in 2023.

But the range of the increase may be limited, as the current scale of foreign exchange reserve is considered to be within a reasonable level, and the central bank is unlikely to significantly increase or decrease foreign exchange reserves, he noted. 

Global Times