June 7, 2020 / 2:40 AM / a month ago

China's May forex reserves unexpectedly rise to $3.102 trillion

BEIJING, June 7 - China’s foreign exchange reserves rose unexpectedly in May even as the yuan weakened on worries over an escalation in Sino-U.S. tensions.

The country’s foreign exchange reserves - the world’s largest - rose $10.233 billion in May to $3.102 trillion, central bank data showed on Sunday.

Economists polled by Reuters had expected the reserves would fall by $10.459 billion to $3.081 trillion due to fluctuations in global exchange rates and the prices of foreign bonds that China holds.

Foreign inflows into Chinese stocks and bonds have picked up recently as investors bet on an economic rebound. Strict capital controls have also largely helped China keep outflows under control over the past year despite the shock from the coronavirus outbreak, a prolonged trade war with the United States and weakening economic growth.

The yuan fell 1.0% against the dollar in May, while the dollar fell about 0.78% in May against a basket of other major currencies.

China held 62.64 million fine troy ounces of gold at the end of May, unchanged from that of end-April.

The value of China’s gold reserves rose to $108.29 billion at the end of May from $106.67 billion at the end-April, reflecting a rise in the dollar-denominated price of the metal.

Reporting by Judy Hua, Yawen Chen and Ryan Woo; Editing by Kenneth Maxwell and William Mallard

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