China and Taiwan Report Decline in Foreign Exchange Reserves

Major Asian economies reported a decline in foreign exchange reserves at the end of June 2026, with both China and Taiwan citing the strength of the U.S. dollar as a primary factor. The State Administration of Foreign Exchange in China reported that its total reserves fell by US$26 billion, a 0.75 percent decrease from May, leaving the total at US$3.4163 trillion. Officials attributed this drop to a rising US dollar index, exchange rate translation effects, and fluctuations in global financial asset prices.

Similarly, the Central Bank of the Republic of China reported that Taiwan's reserves fell below the US$600 billion threshold to US$597.15 billion. This decrease of US$7.922 billion from May resulted from central bank interventions aimed at curbing the appreciation of the U.S. dollar against the Taiwan dollar. These actions followed a hawkish perception of U.S. Federal Reserve Chairman Kevin Warsh and expectations of at least one interest rate hike by year-end.

Taiwanese officials noted that foreign institutional investors further pressured the currency by moving capital gains and dividends out of the country in June. Central bank representatives stated that market interventions were necessary to maintain order and ensure financial stability against sudden fund outflows.