The People's Bank of China said the rapid rise of foreign exchange reserves should ease because of the revaluation of the renminbi, the Financial Times reported. Foreign exchange reserves were up to US$200 billion in 2004, rising most in the fourth quarter. The biggest source of growth in 2004 was offshore US dollar borrowings by Chinese companies. China dropped its peg to the US dollar in July and revalued the renminbi by 2.1%.
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