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Analysts at TD Securities note that China’s FX reserves were higher than expected in June up $1.51bn from the previous month to $3.112.13trn from $1.110.62trn in the previous month.

Key Quotes

“Valuation effects would have resulted in a 0.26% drop in reserves over the month according to our calculations. CNY fell by around 3.3% versus USD and a similar amount in trade weighted terms. It seems unlikely that there was much if any intervention over the months. However, July data will likely be more interesting given the sharp fall in CNY month to date.”