After meeting Chinese President Xi Jinping in Japan on Saturday on the sidelines of Group of 20 summit, U.S. President Donald Trump said he would hold back on tariffs and that China will buy more farm products.
Foreign currency assets (FCA), which form a key component of reserves, rose by $3.54 billion to $377.773 billion. FCAs are maintained in major currencies like US dollar, euro, pound sterling and Japanese yen.
Buoyed by overnight gains on Wall Street, Tokyo's Nikkei began the first day of trading in 2018 by rallying more than 2 percent. Crude oil prices were at 2-1/2-year highs, helping fuel inflation expectations.
The Australian dollar rose 0.1 percent to $0.7586 against the bogged down dollar, putting a bit of distance between a five-month trough of $0.7532 plumbed overnight on dovish-sounding Reserve Bank of Australia policy meeting minutes.
Although Prime Minister Shinzo Abe's ruling party is expected to maintain a solid majority, the memory of recent election upsets in the United Kingdom and elsewhere has kept investors cautious. The dollar fetched 112.22 yen, little changed on the day.