China’s foreign exchange reserves rise in May; expert says it reflects effective response to global challenges

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(Global Times) 09:15, June 09, 2025

A teller counts U.S. dollar bills at a bank in Qionghai, south China's Hainan Province. (Photo/Xinhua)

China's foreign exchange reserves stood at $3.2853 trillion at the end of May 2025, up 0.11 percent from the end of April, official data from the State Administration of Foreign Exchange (SAFE) showed Saturday.

Driven by fiscal and monetary policies, and economic growth prospects of major economies, the US Dollar Index experienced minor fluctuations, and global financial asset prices showed a mixed performance in May. The combined impact of exchange rate conversions and changes in asset prices contributed to the rise of China’s foreign exchange reserves, the State Administration of Foreign Exchange said in a statement.

Beyond these short-term market factors, SAFE emphasized that China's economy continues on an upward trajectory, with a steady improvement in the quality of economic development, offering support for maintaining the basic stability of the scale of foreign exchange reserves.

May marked the fifth consecutive month of growth in China's foreign exchange reserves this year. According to SAFE data, the reserves increased by $6.6 billion in January, $18.2 billion in February, $13.441 billion in March, $41 billion in April, and $3.6 billion in May, media outlet eastmoney.com reported.

Amid the complex and evolving global trade environment, the steady growth in China’s foreign exchange reserves demonstrates an effective response to the complex external environment, Zhu Keli, founding director of the China Institute of New Economy, told the Global Times on Saturday. The support from the domestic economic fundamentals is the key factor, which not only strengthens investor confidence but also provides flexible space for monetary policy.

Meanwhile, the People's Bank of China (PBC), the central bank, has been steadily increasing its gold reserves. PBC data released on Saturday showed that at the end of May, China's gold reserves reached 73.83 million ounces, up 60,000 ounces compared to the 73.77 million ounces at the end of April.

It is the seventh consecutive month for the central bank to increase its gold reserves.

Amid growing volatility in global financial markets, maintaining a stable and adequate level of foreign reserves, including gold holdings, will provide important support for keeping the yuan exchange rate at a reasonable and balanced range, safeguarding China's financial stability against external shocks, Zhu noted.

(Web editor: Tian Yi, Liang Jun)