Money and Metals

The BBC reports on who is holding the Chinese currency. "The amount of yuan held by foreign banks has risen significantly, in anticipation of another rise in the value of China's currency. In the past three months, yuan-denominated debt held overseas rose 3.8% to $266bn, according to figures released by the government."

"Levels of short term deb, regarded by economists as a barometer of the likely speculation in a currency, rose 7.9% to $141.3bn. 'The rise in China's short-term foreign debt reflected continued hot money inflows, showing speculation on a further rise in the yuan remains strong, despite the revaluation,' Xiao Minjie, an economist at the Daiwa Institute of Research."

"US Treasury Secretary John Snow is expected to make the case for a further relaxation in the yuan's exchange rate when he visits China later this month. China's trade surplus rose threefold in the first eight months of 2005 to $60bn, more than for the whole of 2004."