According to the report from the People's Bank of China (PBoC), China's foreign exchange reserves (the world's largest) declined moderately in January after reaching a 2-year high in December. The fall in reserves was due to a significant increase in the US dollar against major currencies. Renewed outflow pressure from a softer yuan and weakening capital markets in China also negatively affected the volume of reserves.
The PBoC said foreign exchange reserves fell to $3.219 trillion from $3.238 trillion in December. Economists had expected a decline to $3.217 trillion.
The US dollar index rose by 1.92% in January, while the yuan fell by 0.98% against the US currency.
The data also showed that China held 72.19 million fine troy ounces of gold (+0.32 million ounces compared to December). Meanwhile, the value of gold reserves remained at $145.7 billion.