Reserves Dip $26 Billion as Dollar Rallies
China's foreign exchange reserves stood at $3.4163 trillion at the end of June 2026, down $26 billion from the end of May, according to data released by the State Administration of Foreign Exchange on July 7, 2026. The monthly decline followed a $34 billion increase in May, leaving reserves broadly stable in the first half of the year overall.
Foreign Exchange Reserve Data
| Date | FX Reserves | Monthly Change |
|---|---|---|
| End of June 2026 | $3,416.3 billion | -$26 billion |
| End of May 2026 | $3,416.3 billion + $26B = ~$3,442.3B | +$34 billion |
| Net H1 2026 change | Broadly stable | Marginal net change |
Why Reserves Declined in June
Two principal factors drove the June decline. First, dollar strength in global currency markets reduced the dollar value of non-dollar reserve assets, including euros, yen, and gold holdings. Second, gold prices fell during the month, directly reducing the valuation of China's gold reserves—a component that has been built up significantly in recent years. The State Administration of Foreign Exchange characterized the June movement as normal market-driven variation.
Structural Support Remains Solid
Beneath the monthly volatility, China's reserve position remains structurally strong. A large current account surplus, ongoing foreign direct investment inflows, and limited capital outflow pressures all support reserve adequacy. SAFE emphasized that the fundamentals of China's balance of payments are sound, maintaining reserves at a level well above the IMF's adequacy threshold.
The substantial reserve buffer provides important policy flexibility, enabling the PBOC to manage exchange rate volatility and support monetary easing if economic conditions require it, while maintaining confidence in the managed floating exchange rate framework.
Source: State Administration of Foreign Exchange of China, July 7, 2026.