China stanches flow of money out of the country, data suggests

Hong Kong

CHINA rattled markets around the world last year when vast sums of money began flowing out of the country. Estimated at nearly US$1 trillion, the money flows represented growing scepticism that China would be able to fix its deep problems and resume its place as a driver of global economic growth.

Doubts remain about Beijing's ability to rev up slowing growth and patch up its frayed financial system. But new data suggests China has stanched, at least for now, the flow of money that had been pouring out of the country.

Chinese officials said last week that the country's hoard of foreign-exchange reserves grew in March for the first time in five months.

Those reserves - a US$3.21 trillion pot of US dollars, euros, pounds and other currencies that China has accumulated over years of managing the value of its currency - are a rough proxy for money…