Why China Raised Reserve Requirements
"February 11– Bloomberg: “China’s lending surged to 1.39 trillion yuan ($203 billion) in January and property prices climbed the most in 21 months as banks extended more credit in anticipation the government will tighten monetary policy. Lending was more than in the previous three months combined… Property prices in 70 cities rose 9.5% from a year earlier… China’s 9.35 trillion yuan of loans in the past year has added to the risk that the world’s fastest-growing major economy may overheat…”
February 10 – Bloomberg: “China, the world’s second-largest energy consumer, set a January record for crude oil imports as a recovering economy bolstered demand for fuels. Shipments reached 17.1 million metric tons last month…33% more than the year- earlier month.”
February 10 – Bloomberg: “China’s imports climbed for a third straight month in January… Imports climbed a record 85.5% from a year before, a jump that was influenced by a shift in the lunar new year holiday to February this year… Exports rose 21%...”
February 9 – Bloomberg: “China’s passenger-car sales more than doubled in January after the government extended economic stimulus measures… Sales of cars, multipurpose vehicles and sport-utility vehicles increased to 1.32 million units… Total vehicles sales, which include buses and trucks, more than doubled to a record 1.66 million units.”
February 12 – Bloomberg: “China’s January electricity consumption jumped 40.1% from a year earlier as an economic recovery in the world’s second-biggest power producer spurred demand from factories. Power use reached 353.1 billion kilowatt-hours last month, 2.7% higher than in December…”
It is true that some of this extremely rapid growth reflects "Lunar New Year effects" (It's therefore almost certain that growth will be a lot lower in February), but it also reflects very high underlying growth, driven in part by excessively high credit- and money supply growth.