(Yicai) Jan. 8 -- China’s foreign exchange reserves jumped for the fifth consecutive month in December, as a weaker US dollar boosted valuations, while its gold holdings rose for the 14th month in a row.

The country’s forex reserves rose by USD11.5 billion to USD3.3579 trillion as of Dec. 31 from Nov. 30, the State Administration of Foreign Exchange announced yesterday. That compares with USD3.2024 trillion at the end of 2024.

Last month’s increase reflected the combined effect of exchange-rate translation -- the revaluation of foreign-currency assets when expressed in dollars -- and global asset price changes, along with the monetary policies and economic data of major economies, as the US Dollar Index -- a measure of the greenback’s value relative to a basket of other currencies -- fell and the performance of global financial assets was mixed, the SAFE noted.

The modest rise was mainly driven by the drop in the US Dollar Index, said Wang Qing, chief macroeconomic analyst at Golden Credit Rating International. The US Federal Reserve’s rate easing pushed down the dollar, lifting the dollar-value of China’s forex reserves denominated in non-dollar currencies and assets, he added.

China’s trade surplus also broke the USD1 trillion mark for the first time in the first 11 months of the year, providing a solid basis for stable growth in forex reserves.

Exports have grown in both volume and quality, the structure of export products has upgraded, and export destinations have broadened, playing a significant role in supporting the balance of payments, said Wen Bin, chief economist at China Minsheng Bank.

Gold reserves at China’s central bank rose by 30,000 ounces to 74.15 million ounces in December from the previous month, the SAFE data also showed, although the monthly uptick has remained small for several months, consistent with market expectations.

The case for the long-term rise in gold remains intact, Wen noted. Intensified geopolitical tensions and great-power rivalry have weakened confidence in the dollar, while central banks continue to buy the precious metal to diversify and optimize their reserve portfolios amid a broader “de-dollarization” trend.

Editor: Futura Costaglione