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Is China financially decoupling?

China’s goods exports in 2023 were near record levels, yet accumulation of official foreign exchange (FX) reserves was essentially zero.

This combination is unusual

Ordinarily, strong exports imply a large current account surplus, which historically has meant rapid build-up in FX reserves.

This blog post—the third in our new Global Economy and Markets series—examines China’s balance of payments (BoP) for clues.

Conceptually, there may be at least three drivers.

First, China could be stockpiling dollar-invoiced commodities to reduce the…

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