Hot money returns to gamble on China's economic recovery

Foreign exchange reserves, foreign exchange holdings, QFII and other latest data show that international hot money is speeding up into China, meanwhile, the Chinese regulator's warning is also escalating; experts say it is highly concerned about hot money raising capital market prices, squeezing the private sector investment that is not abundant, and increasing structural imbalances in the domestic economy. There are signs that hot money is accelerating into China amid rising expectations of a stronger renminbi and a halo of China's economic recovery. At the same time, China's regulatory authorities are also escalating the warning.　　Experts say it is highly concerned about hot money raising capital market prices, squeezing the private sector investment that is not abundant, and increasing structural imbalances in the domestic economy.　　Concerned about the resurgence of hot money and the end of last year's economic crisis at home worried about the collective exit of hot money in sharp contrast to the market, after a year, worried about the return of hot money back again. The latest data from the central bank show that China's foreign exchange reserves added $61.8 billion trillion in the third quarter, of which 41 billion dollars cannot be explained by the current account surplus and FDI (International direct investment).　　Experts believe that the elimination of exchange rate adjustment factors, most of which are unexplained hot money.　　From another foreign exchange funds in and out of the main indicators ——— foreign exchange accounted for, September new foreign exchange accounted for 398.523 billion yuan, compared to August and July 123.938 billion yuan and 154.091 billion yuan in the new increase, a sharp rise, indicating the entry into the domestic foreign exchange funds to rise sharply. In addition, QFII has always been the wind vane of international hot money. The three quarterly reports revealed by domestic listed companies show that the QFII is raising the share of the financial and real estate sectors significantly.　　The foreign exchange administration recently increased the cap on the amount of investment in a QFII application from 800 million US dollars to 1 billion dollars. With a large increase in the QFII a-share market across the bank echoes, international hot money private armies Hong Kong.　　To this end, the HKMA has injected 4.65 billion, 5.81 billion and 6.2 billion Hong Kong dollars into the banking system on 13th, with a view to suppressing the strength of the Hong Kong dollar, thereby increasing the bank balance in Wednesday by 306.378 billion yuan, the first breakthrough of the 300 billion yuan mark, creating a record high.　　In addition to data, the recent Guangdong and other coastal areas of the media also frequently exposed, the Local has been similar to the 2007 influx of hot money, a lot of overseas funds to the mainland as a carrier disguised as a real enterprise into the mainland. Betting on China's economic recovery "now, China has all the ingredients in the influx of hot money."　　Li Shongmin, a researcher at the Center for International Financial Studies at the world Economic and Political Research Institute of the Chinese Academy of Social Sciences, told reporters that international short-term capital is betting against a revaluation. The renminbi's non-deliverable forward ndf is often used to measure overseas markets ' expectations of a stronger renminbi.　　Last week's 51 annual ndf, which closed at 6.627, implied that the renminbi's appreciation of the yuan against the dollar was expected to rise by 3.03% over the next year, and that the forward market was once again stronger in anticipation of a stronger renminbi. Recently, the B-share index continued to soar, rising by more than 20% since November, onThe Friday was also a sharp increase of 9.42%, which confirms the expectation of foreign capital appreciation of the renminbi from another side. "In addition to the expected appreciation of the renminbi, China's economy took the lead in recovery, leading to a stronger capital market, but also attract hot money inflows."　　"Zhuang, chief economist at the Asian Development Bank, said.　　Statistics from the US Fund Research Institute, EPFR, show that emerging markets have absorbed more than $50 billion trillion in capital this year, and that the BRIC equity funds have had a net inflow.　　Yifangda Investment director Chen Zhimin also believes that China's V-shaped recovery trend has been established, the global political and economic structure is changing, international hot money through a variety of gray channels began to flow, pushing a a-share center of gravity. "Externally, the US economy will continue to rebound in the second half of 2009, with looser fiscal and monetary policy, and the process of reconfiguring risky assets by US financial institutions will not be reversed, which means more short-term international capital flows from the United States to emerging market countries."　　Zhang Ming, a researcher at the Center for International Financial Studies at the World Economic and Political Institute of the Chinese Academy of Social Sciences, predicts that hot money will continue to flow into China in the second half of 2009 Standard Chartered's latest study says it has lowered expectations for China's CPI and benchmark interest rates for 2010, while the central bank is expected to raise the benchmark interest rate by 27 per cent two times in the end of the first quarter of 2010 and the two quarter.　　Industry believes that this is undoubtedly a hot money inflow and a shot of "tonic."　　In response to the escalating warning of the regulatory level in the face of the menacing hot money, our government will continue to upgrade the warning.　　The central bank 11th issued the third quarter monetary policy implementation report first proposed "combined with international capital flows and major currency trends change, improve the RMB exchange rate formation mechanism."　　In this regard, China Foreign Exchange Investment Research Institute Dean Tan Yaling, the Chinese central bank's new formulation shows that the recent international hot money influx phenomenon has aroused high level of concern, China will consider more capital speculation factors, strengthen risk control, to ensure financial security. In addition, the official listing of the PBC November 4 this year, the second Division of Monetary Policy, will focus on "further improve the RMB exchange rate formation mechanism of the reform programme, the formulation of exchange rate policy objectives, tracking the exchange rate changes in the global financial markets, research and detection of international capital flows",　　Shows the importance of the State to the exchange rate mechanism in the increasingly complex international capital flows.　　According to industry sources, the agency is also strengthening hot money through corporate settlement quotas into China's supervision. For hot money inflows may push up a-share market again irrational rise of the general concern, Li Shongmin said, a A-share after 2008 years of slump, will be very "happy" to return to the peak of 6,000, this need not worry too much. The most important concern is that the government's 4 trillion-yuan stimulus package mainly benefits the public sector, hot money pushed up the capital market, the already "lack of blood" of the private sector, may face financing space is again squeezed the horror of the situation, which will lead to China's domestic economicIncreased structural imbalances. ("Beijing Business daily" reporter Huang)