Updated: 2011-06-17 Source: Xinhua
BEIJING, June 16 (Xinhua) -- The People's Bank of China (PBOC), the central bank, said Thursday the country's yuan funds stemming from foreign exchange grew more quickly in May as the newly increased funds hit 376.41 billion yuan (57.9 billion U.S. dollars).
The figure was up 21 percent compared to that in the previous month, according to data released by the PBOC.
The quicker pace of funds increment in May came amid increases in both trade surplus and foreign direct investment (FDI) compared to April.
Data shows China's trade surplus in May widened to 13.05 billion U.S. dollars from 11.43 billion U.S. dollars in April, while FDI also rose to 9.225 billion U.S. dollars from April's 8.464 billion U.S. dollars.
Analysts believe the faster increase of funds stemming from foreign exchange inflows last month was also in part due to a rising yuan against the dollar, which has attracted substantial inflow of international speculative capital, or hot money, into the country.
The country's monthly increase in funds outstanding for foreign exchanges has grown significantly faster this year than the average monthly increase of 272 billion yuan last year, adding heavier pressure to the country to bring down a stubbornly high inflation rate.
Data shows the consumer price index, the main gauge of inflation, soared to a 34-month high of 5.5 percent year-on-year in May, which was well above the government's 4-percent annual target.
In continuous efforts to cool inflation, the central bank on Tuesday announced another hike in bank's reserve requirement ratio (RRR), the sixth time this year. After the rise, effective on June 20, large banks will have to set aside a record 21.5 percent of their total deposits as reserves.