Chinese reserves of gold keep growing – UOB

Economist Ho Woei Chen at UOB Group assessed the recent figures from FX reserves and gold holdings in the Chinese economy.

Key Quotes

“China’s official reserves assets fell US$17.0bn in September comprising US$14.7bn drop in foreign currency reserves and US$2.4bn decline in the gold reserves though its holdings of gold in volume terms has continued to rise to fresh record high of 62.6 mn ounces from 62.5 mn ounces in August. China has been adding to its gold reserves for 10 straight months since December 2018 after having kept it flat in 2017 and most part of 2018 in an apparent policy shift as trade tensions with the US escalate”.

“Overall, China’s foreign currency reserves were still up US$19.7bn YTD in September. While pressure on the economy has increased due to the escalating trade tensions with the US and RMB depreciation (3.5% depreciation vs USD YTD), capital outflows have yet to become a major concern compared to the period in mid-2014 to late-2016 when foreign currency reserves fell by about a quarter from about US$4 trillion to US$3 trillion. This is also shown in the relatively more balanced FX inflows/outflows trend compared to the period of 2014-2016”.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD: Bullish case underpinned by weekend news

The EUR/USD pair has rallied Friday to close with gains for a third consecutive week at 1.1169. There was no particular catalyst for EUR gains. ECB scheduled to meet this week, although no fireworks expected this time.


GBP/USD: Uncertainty or relief? Action granted anyway

Hopes that the UK will avoid a hard-Brexit kept the Pound rallying against all of its major rivals by the end of last week, with GBP/USD finishing it a handful of pips below the critical 1.3000 level.


USD/JPY: Corrective slide to continue on sentiment

The USD/JPY pair closed the week at around 108.40, down Friday for a third consecutive day as the American currency remained under selling pressure. USD/JPY at risk of falling further only if it breaks below 108.00.


Gold turns flat above $1,490 as USD remains under pressure

After dropping to a daily low of $1,485, the XAU/USD pair staged a modest rebound during the American trading hours and turned flat on the day near $1,492.

Gold News

China’s downward economic path offers no escape from its trade problems

There were no surprises in China’s GDP figures as the government portrays an economy slipping steadily lower giving little promise of improvement or support for the waning global expansion.

Read more