The AP reports:

China will soon create one of the world's largest investment funds, with ramifications for global stock, bond and commodities markets and for how the United States finances its budget deficits.

Finance Minister Jin Renqing said Friday the aim is to make more profitable use of China's foreign-currency reserves, which exceed $1 trillion and which have piled up as China has posted huge trade surpluses year after year. Most of those funds are now parked in safe, but relatively low-yielding, U.S. Treasury securities and other dollar-denominated assets.

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http://www.washingtonpost.com/wp-dyn/content/article/2007/03/09/AR2007030902152.html?referrer=email