China's foreign exchange reserves top $2 trillion for first time


Even though China's exports remain under pressure, its foreign exchange reserves grew to over $2 trillion for the first time. The People's Bank of China reported that reserves increased in value by $178 billion during the April to June period to $2.13 trillion.

"With a subdued trade surplus, export revenues are clearly not driving reserve growth. The majority of the gains appear to have come from valuation changes due to the depreciation of the dollar, which boosted the value of China's non-dollar holdings," Alaistair Chan of Moody's told MarketWatch. China is one of the countries looking to diversify its foreign exchange holdings. Yet it is estimated that 65 percent of its foreign exchange holdings are in U.S. Treasuries. Other holdings include the euro, yen and sterling.