Even if they wanted to they wludon't unwind their entire dollar position. There is already downward pressure on the dollar (obviously), if they were to add to that with a huge inflow of dollars in the FX market, they would be selling low and buying high (swap from dollar to Euro), not effective. Especially when, by nature of their trade structure, they will be receiving a steady stream of US dollars from export activity. So long as the Wal-Mart is the eighth largest trade partner with China they will be chained to the dollar. Was this answer helpful?
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