Surging flows may lead to stock market volatility, say economists

The rising inflow of speculative capital, or "hot money", into China could lead to "asset bubbles", said Fan Gang, member of the central bank's monetary policy committee.

The latest foreign exchange reserves figures released by the People's Bank of China reveal that inflows increased by about $37.2 billion - the second highest monthly rise this year - to $2.78 trillion by the end of November.