China's forex reserve tops US$2 trillion

China's foreign exchange reserve swelled at a record pace in the second quarter to top the US$2 trillion milestone for the first time. The reserve rose by a record US$178bn in the second quarter to US$2.132 trillion, the People’s Bank of China said. That dwarfs a US$7.7bn gain in the previous three months. The increase came amid strong signs of economic recovery in China, spurred by the government's stimulus package and a strong growth in bank lending in the first six months of the year. Property and stock prices have also climbed over the last few months. Data released by the central bank today also showed that M2, the broadest measure of money supply, rose by as much as 28.5% in June from the year-earlier period. Separately, China's foreign currency regulator said today that it will ease curbs on outflows of capital. The State Administration of Foreign Exchange will expand the sources of capital Chinese can use to fund outbound spending and let companies send investment funds overseas without prior approval, it said.