China’s foreign exchange reserves touch $2.4 trillion

China, the world's third-largest economy, added $126.5 billion in the last quarter of 2009, the People's Bank of China, the central bank, announced today.

Despite the global economic slowdown and many countries facing the worst recession, China's foreign exchange reserves surged by 23.28 per cent and added $453 billion to hit $2.4 trillion in 2009.

Already holding the world's largest foreign exchange reserves, China added $10.4 billion to its forex reserves in December alone.

Heeding the government's diktat last yar to increase lending to help fend off the global financial crisis, Chinese banks raised lending in the first 11 months of 2009 to 9.5 trillion yuan ($1.4 trillion) almost double the government's target of 5 trillion yuan for the entire year.

With a majority of these loans being used to prop up the stock and property markets, the prices in these sectors have skyrocketed, creating yet another bubble.

China doled out 9.6 trillion yuan ($1.4 trillion) in new loans in 2009, which worked out to a whopping 27 per cent of its 2009 GDP.