Business and Finance

BEIJING–China’s foreign exchange reserves jumped $57.3 billion (U.S.) in February to $1.6471 trillion, almost matching January’s surprising leap of $61.6 billion, sources familiar with the data said yesterday.

The leap will fan talk of speculative hot money coming into China; the increase is more than three times greater than February’s combined inflows from the trade surplus and foreign direct investment. These totalled $8.6 billion and $6.9 billion, respectively cash advance.

The pace of accumulation in the first two months of this year dwarfs last year’s average monthly increase in China’s reserves of $38.5 billion.

The reserves, the world’s largest, have ballooned because the central People’s Bank of China, in order to hold down the yuan, buys most of the dollars that flow into China.

Reuters News Agency

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