Govt 'may have lost $80b in equities'

The government may have lost more than $80 billion of its foreign exchange reserves after buying into equities just before world markets collapsed last year, the UK-based Financial Times said yesterday.

The investments were made by the State Administration of Foreign Exchange, or SAFE, the manager of the nation's nearly $2 trillion of reserves, the newspaper said.

"SAFE has built up one of the largest US equity portfolios of any foreign government entity investing abroad, including the major sovereign wealth funds," Brad Setser, an economist at the Council on Foreign Relations, a US-based think tank, told the paper.