At the end of 2005, the balance of China's foreign exchange reserves was $81887.2 billion, up 34.3% year-on-year, and the growth rate was 17 percentage point lower than that of the previous year. Foreign exchange reserves increased by $208.9 billion, an increase of $2.2 billion year-on-year.
From the perspective of reserve assets, China's foreign exchange reserve structure is relatively simple, even in the case of depreciation of the US dollar, it is still dominated by US dollar assets. Gold is one of the major international reserve assets. China's gold reserves are 105 1.6 tons, accounting for only 1.6% of China's total foreign exchange reserves, far below the level of developed countries in the world.
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As a country's economic guarantee, gold reserve plays an extremely important role in a country's economy, and has an important positive role in stabilizing the state-owned economy and maintaining monetary stability.
Gold is a unique asset, which is not directly affected by any country's monetary policy and finance. Therefore, when there is domestic inflation, gold will not depreciate. So there is no risk, so saving some gold at home is not afraid of inflation.
In an emergency, all countries may need mobile resources. Gold has liquidity and is a generally accepted means in all countries. Besides, gold can be mortgaged.