All figures percentage year-on-year unless otherwise stated.

Monetary Aggregates

Feb Jan Dec Nov Oct M2 +25.52 +25.98 +27.68 +29.74 +29.42 New Loans (bln yuan) 700.1 1390.0 379.8 294.8 253.0

BEIJING (MNI) - China's economic recovery continued to gain traction at the start of this year, data releases this week suggest, though distortions created by the Chinese New Year holiday mean that the government is likely to wait before deciding on the timing of a much-anticipated rate hike.

Beijing is widely expected to raise benchmark interest rates at least once this year as its continues to remove some of the stimulus policies introduced to counter the late 2008 global financial crisis.

BEIJING (MNI) - China's banking regulator warned domestic lenders Thursday of increasingly complicated global economic and financial conditions, in part the result of problems western countries are having with their sovereign debt issues as well as the timing of exit strategies from stimulus policies.

China Banking Regulatory Commission director Liu Mingkang said in a release that banks need to tighten up their risk management as a result of the increasing difficulties facing the world.

BEIJING (MNI) - There is no evidence that the Chinese economy is overheating, an official with the National Bureau of Statistics said Thursday, arguing that price pressures are likely to ease in March over February as a result of seasonality.

His comments were followed by a report from the official Xinhua News Agency citing People's Bank of China deputy-governor Su Ning who reportedly said that the strength seen in February consumer price inflation was the result of the Chinese New Year holiday.

BEIJING (MNI) - The head of China's foreign exchange reserve manager reiterated Tuesday the government's cautious approach to exchange rate reform while warning against attempts to politicize the its massive purchases of U.S. Treasuries.

Yi Gang, the director of the State Administration of Foreign Exchange (SAFE) and a vice-governor of the People's Bank of China, reaffirmed China's commitment to Treasury purchases in a rare briefing with reporters here.

BEIJING (MNI) - China faces rising capital inflows speculating on yuan appreciation this year, in part the result of higher Chinese interest rates, the director of the State Administration of Foreign Exchange said in a statement issued Tuesday.

Yi Gang also confirmed that China's $2.4 trillion in foreign exchange reserves are "appropriately diversified" among currencies including the dollar, euro and yen.

BEIJING (MNI) - The recent moves by the People's Bank of China to raise the deposit reserve requirement for domestic banks are not indicative of monetary tightening and were simply designed to soak up excess liquidity in the banking system, a senior central bank official said Monday.

"Foreign capital inflows have created a lot of money supply in the banking system. There's too much liquidity. It's quite normal to mop it up with reserve hikes," central bank vice-governor Su Ning told reporters at a briefing here.

BEIJING (MNI) - The idea that China is gearing up for a near-term resumption of yuan appreciation could be wishful thinking, even if central bank Governor Zhou Xiaochuan acknowledged that the current dollar peg will eventually be dropped.

That China will "sooner or later" exit from its stimulus policies introduced to counter the global financial crisis, as the People's Bank of China governor told reporters on Saturday, has always been a given.