Quick review: June 12-18
(China Daily)
Updated: 2006-06-19 10:56 Money supply
China's money supply grew the most in four months in May,
placing more pressure on the central bank to withdraw money from the financial
system and allow the yuan to rise.
M2, the broadest measure of the money
supply, which includes cash and all deposits, rose 19.1 per cent from a year
earlier after an 18.9 per cent increase in April, the People's Bank of China
said last week.
The supply of money in China is soaring as the trade
surplus widens, overseas investors bet on the appreciation of the yuan, and the
central bank buys dollars to stabilize the currency.
The central bank
governor Zhou Xiaochuan, who raised benchmark lending rates in April, last month
said credit-fuelled investment threatens to stoke inflation and create asset
price bubbles.
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