China’s FX Reserves Drop on Yuan Support

China's foreign exchange reserves fell by a record $93.9 billion last month as the central bank intervened to prop up the yuan after the biggest devaluation in two decades. Reserves dropped to $3.56 trillion from $3.65 trillion in July. Capital outflows increased on fears over China's economic slowdown and prospects of higher U.S. interest rates. The yuan closed at 6.3659 per dollar on Monday. "If the central bank continues its intervention, China's foreign-exchange reserves will continue to shrink," said Li Miaoxian, a Beijing-based analyst at Bocom International Holdings. "The heavier the intervention, the deeper the fall."