China’s Foreign-Exchange Reserves Fall to $3.4003 Trillion

What changed

China’s foreign-exchange reserves fell by $38.1 billion, or 1.11%, from August to $3.4003 trillion at the end of September 2026.

The State Administration of Foreign Exchange said the decline reflected a stronger dollar index and broadly lower prices for major global financial assets, alongside exchange-rate conversion and asset-price effects.

Why it matters

The headline number fell, but the more important detail is what appears to have driven it. A cited economist said the change was more likely a valuation adjustment caused by market swings than a clear shift in foreign-exchange supply and demand.

That makes this look less like a sudden loss of financial capacity and more like a mark-to-market move on a very large reserve portfolio. China still held more than $3 trillion in reserves at month-end, leaving a substantial buffer as global currencies and asset prices move.

The outlook depends partly on whether China’s exporters keep providing support through external earnings. Another cited economist said exports should remain resilient, while a reported China-US framework involving $30 billion in reciprocal tariff reductions could help exports of toys, household appliances, baby products, kitchen and bathroom goods, and holiday gifts. The separate contribution of market valuations and underlying foreign-exchange flows remains unclear, so the next reserve reading will show whether September was mainly a temporary market effect or part of a broader change.