Submitted by Peter Fleming on Tue, 13/06/2006 - 7:29pm.
The Chinese foreign exchange reserves, which is also the worlds largest, has risen to over $900 billion (US) as a result of China's increasing trade surplus. This increase has been followed by several consecutive years of trade surpluses, which gives a challenge to policy makers. Analysts have expected that China will raise its bank reserve requirements to hinder excess liquidity that has fueled a destabalizing credit boom. There is also the possibility of a second interest rate hike.
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