adminBEIJING. — China’s foreign exchange reserves, the world’s largest, fell by $87,2 billion in November to $3,44 trillion, central bank data showed yesterday, indicating a pick-up in capital outflows that have put pressure on the central bank to support the yuan.
The fall in foreign exchange reserves was the biggest since a record monthly drop of $93,9 billion in August, after a rise of $11,4 billion in October.
“The pick-up in capital outflows appears to have been predominately driven by increased expectations for renminbi (yuan) depreciation” Julian Evans-Pritchard at Capital Economics said in a note.
“A rise in offshore interest rates due to the increased likelihood of a December Fed rate hike will also have added to outflow pressures.”
China’s surprise devaluation of the yuan on August 11 fuelled a wave of capital outflows on fears the world’s second-largest economy might be slowing more sharply than thought, and on worries of a possible interest rate rise by the US Federal Reserve.
Such outflows eased briefly in October, helped by a rebound in the domestic stock market and the official crackdown on illegal foreign exchange transactions.
The value of China’s gold reserves stood at $59,52 billion at the end of November, down from $63,26 billion at the end of October, the People’s Bank of China (PBOC) said on its website.
China’s International Monetary Fund (IMF) reserve position was at $4,60 billion, down from $4,64 billion the previous month. It held $10,18 billion of IMF Special Drawing Rights at the end of last month, compared with $10,36 billion at the end of October.
The central bank in July shifted to reporting its foreign exchange reserves on a monthly basis after adopting the IMF’s Special Data Dissemination Standard (SDDS). The bank had previously released the data on a quarterly basis. — Wires.
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