China's forex reserves hit $1.76 trillion: Report
China's foreign exchange reserves rose to $1.76 trillion at the end of April, state media reported on Monday, reaching a level higher than the rest of Northeast Asia's combined.
By Agencies |
SHANGHAI: China's foreign exchange reserves rose to $1.76 trillion at the end of April, state media reported on Monday, reaching a level higher than the rest of Northeast Asia's combined.
China's reserves, by far the largest in the world, expanded by another $74.5 billion during April, the China Business News reported, equivalent to about 100 million dollars every hour.
At $1.76 trillion, China's reserves are now larger than those of Japan, Taiwan, South Korea and Hong Kong combined.
It is possible that one day China's forex reserves might even top those of all other Asian countries combined, according to Brian Mak, a Hong Kong-based economist with Core Pacific Yamaichi.
"Much of the money represents investment inflows, and the economic conditions are much better in China than other Asian countries such as India," he said.
"It will continue to expand unless the government does something to curb the inflows," he said.
The growth in reserves came amid rising official concern about a fresh surge in hot money -- or speculative inflows -- spurred by a strengthening yuan and a widening spread between falling US interest rates and rising Chinese rates.
The increase in reserves was roughly three times larger than the trade surplus and the value of incoming foreign direct investment -- the two traditional sources of reserve growth.
This led analysts to conclude that perhaps as much as $50 billion entered the economy in the form of hot money.
"This (figure) seems to suggest the inflow of hot money is speeding up," the newspaper quoted Logan Wright, an analyst with Stone and McCarthy Research Associates, as saying.
China's reserves, by far the largest in the world, expanded by another $74.5 billion during April, the China Business News reported, equivalent to about 100 million dollars every hour.
At $1.76 trillion, China's reserves are now larger than those of Japan, Taiwan, South Korea and Hong Kong combined.
It is possible that one day China's forex reserves might even top those of all other Asian countries combined, according to Brian Mak, a Hong Kong-based economist with Core Pacific Yamaichi.
"Much of the money represents investment inflows, and the economic conditions are much better in China than other Asian countries such as India," he said.
"It will continue to expand unless the government does something to curb the inflows," he said.
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The growth in reserves came amid rising official concern about a fresh surge in hot money -- or speculative inflows -- spurred by a strengthening yuan and a widening spread between falling US interest rates and rising Chinese rates.
The increase in reserves was roughly three times larger than the trade surplus and the value of incoming foreign direct investment -- the two traditional sources of reserve growth.
This led analysts to conclude that perhaps as much as $50 billion entered the economy in the form of hot money.
"This (figure) seems to suggest the inflow of hot money is speeding up," the newspaper quoted Logan Wright, an analyst with Stone and McCarthy Research Associates, as saying.
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