On September 7, the Bank of China announced that, in August, its foreign-exchange (forex) reserve dropped by $93.9 billion to about $3.6 trillion. It is the fourth consecutive monthly drop and the biggest ever monthly decline.
China’s forex reserves hit a record high of nearly $4 trillion in June 2014. It has since fallen from the peak by a total of $435.8 billion, indicating the trend of money leaving China has continued steadily.
Guan Tao, former Director at the Balance of Payments Department in the State Administration of Foreign Exchange, expressed that it will be the new norm that the reserves’ fluctuation is more volatile in the short term than in the long term.
Source: Beijing Youth Daily, September 8, 2015