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Draghi Confined by China $4 Trillion Reserves: Chart of the Day

European Central Bank President Mario Draghi’s plan to weaken the euro to aid exporters faces a $4 trillion challenge: how to cope with China’s efforts to diversify reserve assets, most of which are now in dollars.

The CHART OF THE DAY tracks China’s total reserves, Treasury holdings and share of global foreign-currency reserves, along with the performance of the yuan and euro since the start of 2013. The People’s Bank of China buys dollars to help stop the yuan strengthening and these purchases helped boost its currency reserves by $126 billion to a record $3.948 trillion in the first quarter. China holds about a third of the world’s international reserve assets excluding gold.