Shanghai: China’s foreign exchange reserves fell more than expected to an 18-month low in October amid rising US trade frictions, suggesting authorities may be slowly stepping up interventions to keep the yuan from breaking through a key support level.

Reserves fell by $33.93 billion in October to $3.053 trillion, central bank data showed on Wednesday.

The drop was the biggest monthly decline since December 2016, and compared with a fall of $22.69 billion in September. Economists polled by Reuters had expected reserves to drop $27 billion to $3.06 trillion.

China’s foreign exchange regulator attributed the fall to adjustments in global asset prices and currency valuation effects caused by a 2.1% rise in the dollar index.

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