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Forex reserves rise in October

Updated: Nov 8,2015 10:57 AM     Xinhua

BEIJING — China’s foreign exchange reserves rose to $3.53 trillion at the end of October, the central bank announced on Nov 7.

The reserves grew by $11.4 billion in October, ending five months of decline, according to the People’s Bank of China.

Gold reserves climbed from $61.2 billion at the end of September to $63.3 billion at the end of October.

Fueled by exports, forex reserves grew for more than a decade before beginning their decline in the third quarter of 2014. In the third quarter of 2015, forex reserves fell by $180 billion, much more than the $40 billion decrease in the second quarter, a fifth consecutive quarterly drop.

In September, China’s central bank adviser Huang Yiping dispelled worries that the forex reserves are running out following a record fall in August, saying intervention in the market will not persist.

On Aug 11, the central bank decided to let the market have a greater say in forming the yuan’s central parity rate against the US dollar, which led to a depreciation of more than 4 percent in August.

The current intervention is due to concerns over excessive fluctuations of the exchange rate, but China’s ultimate goal is to make market supply and demand play a larger role in the rate formation system.