Published by Jamie JemmesonThe regulator of China's foreign exchange market has denied claims circulating in the media that there was a dramatic rise in hot money inflows during 2009.Hot money describes the process of buying foreign currency in order to take advantage of favourable exchange rates. Media reports have claimed that such inflows may have totalled $167 billion last year.However, China Economic Reviews reports that the State Administration of Foreign Exchange has rejected claims, labelling the process of deduction used to arrive at the headline figure simplistic and unscientific.It also added that it had sufficient data to account for the inflows, although it conceded that there has been a considerable rise in the size of its speculative foreign exchange market, with the group vowing to impose limits on such activity.China has also recently been pressured to revalue the yuan as many analysts view the currency as substantially undervalued, a factor that may have helped to maintain strong export growth despite adverse economic conditions.For more information on foreign exchange treasury services and risk management, visit our Corporate FX site