China's forex reserves reach record level in 2004

China’s forex reserves reach record level in 2004

China's foreign exchange reserves rose to a record $609.9 billion in 2004 against $403.3 billion registered in 2003 due to the strong fund inflows and developing trade surplus. In 2003, China's reserves rose by $160 billion. China has the world's second-biggest foreign currency reserves after Japan. Japan's foreign reserves reached $844.5 billion in December. The steep rise in foreign reserves highlights the seriousness of the speculation on the currency. Hot money coming into the mainland accounts for about $120 billion of the reserve total. Meanwhile, China's trade surplus reached $32 billion in 2004, indicating a rise of 25.6% on the back of booming economy.