JPMorgan Econ FI-China FX reserves largely in line with expectation A glance...-109079431

JPMORGANAsiaPacificEconomicResearch07July2024China:FXreserveslargelyinlinewithexpectationAglanceatBoPandcustoms’tradebalancedifferenceChina’sJuneFXreservesfellUS$9.7bnto$3,222.4bn,largelyinlinewithourEmergingMarketsAsia,Economicexpectationof$3,225.8bn.ItfollowstheUS$31.2bnriseinMay.For1HasaandPolicyResearchwhole,FXreservesfellUS$15.6bn.SameasMay,goldreservesstayedunchanged,TingtingGeaftersolidincreasesintheprior18consecutivemonths.(852)2800-0143•Ourbaselineforecastlooksfor0.2%m/msauptickinexports,and1.2%gaintingting.ge@jpmorgan.cominimports,leavingtradesurpluselevatedatUS$84.3bninJune.ServicesHaibinZhuaccounthasroughlyrecoveredtothepre-pandemiclevel,averagingataUS$21.2bndeficitinJan-May.Hence,weexpectcurrentaccountsurplusfor(852)2800-7039goodsandservicesmayhavemovedupto$39.3bn(vs.$33.6bninMay).haibin.zhu@jpmorgan.com•Meanwhile,theUSdollarindextickedupfrom104.7to105.9inJune,leadingGraceNgtoanestimatedcurrencyvaluationlossofUS$15.6bn.Takentogether,we(852)2800-7002tentativelyestimateaUS$33.4bnimpliedcapitaloutflowinJune(vs.-USgrace.h.ng@jpmorgan.com$22.0bninMay).JiYan•Notethat,foreigninvestorsaddedanotherUS$24.0bnholdingofChinese(852)2800-7673bondsinMay,ledby$12.2bninflowsforNCDsand$7.1bnforpolicybankji.yan@jpmorgan.combonds.Juneforeignbondflowsdataisnotpublishedyet.Ourstrategists’JPMorganChaseBank,N.A.,Ho...