In January 2007, the Renminbi Pressure Indicator (RPI) increased by 1.33 percent, the largest month-to-month increase since the initial revaluation in July 2005. China's foreign exchange reserves rose to US$1.1 trillion.

The gain in the RPI, from 194.1 to 196.6 over the previous month, was attributable to appreciation of the yuan and an increase in foreign exchange reserves, which increased nearly US$38.3 billion from December.

The reserves increase was the highest month-to-month jump in absolute dollar amount. In percentage points, China's foreign exchange reserves represented the greatest gain since December 2004. The rate of yuan appreciation against the U.S. dollar accelerated to 0.40 percent, from 0.31 percent in December, while growth in China's foreign exchange reserves accelerated to 3.60 percent, from 2.67 percent. Of the 1.33 percent growth in RPI, the yuan appreciation accounted for a 0.13 percentage point increase, and growth in reserves contributed the remaining 1.20 percentage point increase.

There was no change in domestic interest rates in January. (In February and March 2007, the rates of yuan appreciation against the dollar grew 0.47 and 0.07 percent, respectively. Interest rates increased by 0.27 percent in March.)