All Eyes on China’s FX Reserves

Capital flight on trade tensions and depreciating yuan could dent reserves

A man looks at currency information posted on the window of a bank in Beijing on July 20, 2018. Wang Zhao/AFP/Getty Images

China’s foreign-exchange reserves rose modestly in July, which caught many analysts by surprise, given the ongoing trade dispute between the United States and China.

Foreign-exchange (FX) reserves increased by $5.8 billion to $3.1 trillion, according to figures from the People’s Bank of China, the country’s central bank. A decline of about $12.1 billion was expected by economists polled by Thomson Reuters.