China’s Foreign Currency Reserves Drop First Time in 3 Months
(Bloomberg) -- China’s foreign-currency holdings slipped for the first time in three months in June as a stronger dollar cut the value of assets in other currencies.
Reserves fell to $3.214 trillion from $3.222 trillion in May, the People’s Bank of China said Wednesday in a statement, compared with the median estimate of $3.2 trillion in a Bloomberg survey of economists.
- The Bloomberg dollar spot index advanced 2.9% in June to its highest level since early April, after the Federal Reserve brought forward its projections for interest rate hikes
- China’s foreign reserves are denominated in U.S. dollar, and assets in non-dollar currencies declined in value after they were converted to dollar terms, Wang Chunying, spokeswoman for the State Administration of Foreign Exchange, said in a separate statement after the data
- The economy is operating in a stable manner with more strength and improvement, and its internal drivers are strengthening, which will help keep the size of reserves stable, she said
- The value of China’s gold reserves decreased to $110.45 billion
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