What if China's FX reserves drop below the $2.5 trillion adequacy threshold?
Sustained intervention to defend the yuan drains FX reserves below the $2.5tn IMF adequacy threshold for the first time in over a decade, intensifying devaluation fears and outflow pressure.
how we built this number — every step
The class rate is measured from our dated, sourced event library (decade-normalized Poisson — the full table is public at base_rates.json). The variant’s share within its class is the analyst’s editorial call, published so you can audit it. A wider range means thinner precedent. Full recipe: methodology · scored at Reality Check.
The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (gold) over time vs the crowd's (Polymarket, blue), from the past toward the 1–3 years horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. The gold path is an illustrative reconstruction anchored to today's estimate — real dated events, not a live re-estimate history.
What it would mean
If this plays out, it is a risk-off shock. Sustained intervention to defend the yuan drains FX reserves below the $2.5tn IMF adequacy threshold for the first time in over a decade, intensifying devaluation fears and outflow pressure. The trigger decomposes into signed root‑shocks — EM currencies ▼ · China growth ▼ · Dollar/reserve confidence ▼ · Risk appetite ▼ — which propagate through our causal graph to the markets below.
If it happens — the markets it would move
Biggest moves first. Projected moves are cascade-model priors; hist A–B% = what comparable past events actually did (measured abnormal returns), and model prior · unmeasured marks markets with no analogue backing yet. Tap any market for its price history.
| Market | Class | Projected move | |
|---|---|---|---|
| 1 | Gold XAUon Hyperliquid 📈 chart | Commodity | ▲ +0.8% hist -0.23–+1.8% · other way -0.17% (n=12) |
| 2 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▲ +0.8% hist -0.22–+1.57% · other way +24.57% (n=12) |
| 3 | Turkish lira TRY 📈 chart | FX | ▼ -0.5% hist -0.4–-0.15% · other way -0.25% (n=12) |
| 4 | Bitcoin BTCon Hyperliquid 📈 chart | Crypto | ▲ +0.4% hist -4.56–+1.62% · other way +5.56% (n=12) |
| 5 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▼ -0.4% hist -1.26–+0.25% · other way -0.29% (n=12) |
| 6 | Freeport (copper) FCX 📈 chart | Equity | ▼ -0.5% hist -3.35–+1.23% · other way +1.0% (n=12) |
| 7 | Indian rupee INR 📈 chart | FX | ▼ -0.4% hist -0.34–-0.1% · other way -0.09% (n=12) |
| 8 | Copper XCUon Hyperliquid 📈 chart | Commodity | ▼ -0.4% hist -0.27–-0.11% · other way +2.36% (n=12) |
| 9 | Chinese yuan CNY 📈 chart | FX | ▼ -0.4% hist -0.46–-0.03% · other way -0.81% (n=12) |
| 10 | US dollar (DXY) DXYon Hyperliquid 📈 chart | FX | ▼ -0.4% hist -0.25–+0.03% · other way +0.7% (n=12) |
| 11 | China internet KWEBon Hyperliquid 📈 chart | Equity | ▼ -0.4% hist -1.98–+0.48% · other way -0.28% (n=12) |
| 12 | Alibaba BABAon Hyperliquid 📈 chart | Equity | ▼ -0.3% hist -0.76–+1.07% · other way -2.98% (n=12) |
| 13 | EUR/USD EURUSDon Hyperliquid 📈 chart | FX | ▲ +0.4% hist -0.05–+0.23% · other way -0.53% (n=12) |
| 14 | Coinbase COINon Hyperliquid 📈 chart | Equity | ▲ +0.3% hist -1.62–+0.76% · other way +18.8% (n=12) |
Probable recommendation
Historical precedent — what analogous events actually did
Across 40 analogous events (overlap‑weighted), as abnormal returns — market beta stripped, so it's the event's own effect, not the market backdrop. Shown at 20 days (persistent) and 5 days (immediate); ↺ fades = the two horizons disagree. Confidence = consistency × sample × significance.
| Asset | History says | Abnormal (20d · 5d) | Hit | n | Confidence | vs cascade |
|---|---|---|---|---|---|---|
| KWEB KWEB | SHORT | -1.6% · 5d -1.6% | 61% | 32 | 0.21 | ✓ matches cascade |
| Bitcoin BTC | SHORT | -4.3% · 5d -4.5% | 63% | 32 | 0.19 | ⚠ differs |
| Gold XAU | LONG | +1.3% · 5d +0.7% | 61% | 32 | 0.17 | ✓ matches cascade |
| SPX SPX | LONG | +0.9% · 5d +0.2% | 60% | 39 | 0.17 | ⚠ differs |
| COIN COIN | SHORT | -1.7% · 5d -1.5% | 58% | 27 | 0.15 | ⚠ differs |
| US dollar DXY | LONG | +0.2% · 5d -0.1% ↺ fades | 59% | 39 | 0.14 | ⚠ differs |
| NDX NDX | SHORT | -1.0% · 5d -1.4% | 58% | 37 | 0.13 | ✓ matches cascade |
| EURUSD EURUSD | SHORT | -0.2% · 5d +0.2% ↺ fades | 59% | 32 | 0.13 | ⚠ differs |
| High-yield credit HYG | SHORT | -0.2% · 5d +0.2% ↺ fades | 59% | 32 | 0.13 | · |
| Volatility VIX | SHORT | -0.6% · 5d +1.2% ↺ fades | 57% | 34 | 0.12 | ⚠ differs |
| KRW KRW | SHORT | -0.2% · 5d -0.0% | 57% | 32 | 0.11 | ⚠ differs |
| XCU XCU | SHORT | -0.1% · 5d -0.7% | 57% | 32 | 0.10 | ✓ matches cascade |
| MSTR MSTR | LONG | +1.1% · 5d -5.0% ↺ fades | 54% | 32 | 0.08 | ✓ matches cascade |
| CNY CNY | SHORT | -0.2% · 5d -0.2% | 54% | 32 | 0.08 | ✓ matches cascade |