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China’s foreign exchange reserves are likely to rise given the weakening US dollar index and a stronger yuan, the Securities Times reported, citing analysts.

Key quotes

“The dollar index may weaken given the Federal Reserve’s low-rate policies and record high US trade and fiscal deficits.”

“China-US interest rate spreads and China’s robust trade surplus favor the yuan.”

“China’s FX reserves stood at USD3.21 trillion at the end-Jan, down USD5.9 billion from end-December. “