China's Alan Greenspan (Zhou Xiaochuan) has indicated China won't roil financial markets with "active composition adjustments of the foreign reserves."  fine.   But any central bank adding about $20 b a month to its reserves has ample scope to change the composition of its reserves over time without selling any of its existing holdings.

Zhou also indicated that the central bank "will reduce its purchases of foreign exchange in the market, while companies will keep more foreign exchange."  (Quotes for Wu and Carew of Dow Jones, in today's Wall Street Journal, on p. A14).

Count me a skeptic.  I want to see what has happened to China's reserves since the July 21 revaluation - and China, unlike most other Asian economies, has still yet to release its end July or end August reserve data.   But we know that China posted large trade surpluses in both July and August, which suggests continued strong reserve growth. When it comes to transparency, China's central bank lags behind other Asian central banks ...

Continues.