The policies of China - the 800 pound gorrila matter as much as FOMC.
CHINA’s foreign exchange reserves, swollen by its huge export earnings, have outstripped those of Japan to become the world’s largest and are on course to exceed $1 trillion (£570 billion) before the year’s end.
China’s reserves finally overhauled Japan’s in scale at the end of February, climbing to $853.7 billion, the country’s China Business News said yesterday
Key factors in the ballooning of the reserves has been the rapid growth in China’s exports, together with its continued intervention in foreign exchange markets to thwart any strengthening in its yuan currency.
China has continued to invest a large part of its huge reserves in US bonds and assets. It held $262.6 billion in US government treasury bonds at the end of January, making it the largest single investor after Japan.
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