- The latest data show a reduction in FX reserves across much of the region, as central banks likely sold dollars amid risk aversion and currency intervention
- The preference appears to be stability when global conditions are uncertain and volatile
- Still, we notice an ongoing gradual shift towards more permissiveness of currency strength
- Despite a lack of persistent appreciation pressure in recent months, some policymakers continue to look for tighter regulatory management of FX markets
- China’s reserves continued to steadily rise in 2Q. Ongoing reserve accumulation has not constrained China’s ability to tighten domestic conditions, but the costs and impact of China’s intervention have not gone unnoticed domestically or internationally
Click here to read the full report:
http://www.easyforexnews.net/wp-content/uploads/2011/07/303301.pdf
HSBC Global Research