In October, China's FX reserves unexpectedly rose, but there are unlikely to be similar surprises in Japan's numbers due early on Tuesday, according to figures from Beijing on Monday.
The data will shed light on exactly where Tokyo's record $42.8 billion yen-buying currency market intervention came from, with investors hoping that the data will show a decline in official reserves.
The official stash of China went up $23.47 billion last month to $3.052 trillion - analysts had expected a fall to $3.018 trillion - while Japan held $1.24 trillion at the end of September.
China's increase may be due to the euro's rise of almost 1 per cent against the dollar last month. A lot of China's FX reserves are thought to be in euro-denominated assets, unlike Japan's, which are overwhelmingly invested in dollar assets.
Japan's Ministry of Finance spent $42.8 billion last month to prop up the yen. This followed almost $20 billion of intervention in September.
China and Japan are the world's top two FX reserves holders, and how they manage their $4 trillion of reserves has a huge impact on world markets, especially the U.S. Treasuries.
If either of the two sell Treasuries outright to support their exchange rates, U.S. yields could go up, tightening U.S. and global financial conditions. There are growing concerns surrounding U.S. bond market liquidity without two of the world's largest holders of Treasuries actively selling.
Around 10 per cent of Japan's reserves are held by foreign institutions and can be easily tapped for dollar-selling intervention. Tokyo might have dipped into this pool of funding before selling Treasuries.
Japan's reserves fell by a record $54 billion in September, and the 4.2 per cent decline was the biggest since 1998. Some form of dollar asset sales will figure more prominently in October's report, due to valuation effects though.
Three key developments that could give more direction to markets on Tuesday are: