Figures on Friday showed Japan, the world's largest holder of foreign exchange reserves, increased its reserves by $18.3 billion in November to $644.6 billion. In Taiwan, the third largest holder, reserves rose $6.2 billion to $202.8 billion.

Asian foreign exchange reserves have risen by $415 billion -- 28.9 per cent -- since the end of 2002.

The build-up of reserves, mostly in US dollars, largely reflects intervention by the region's monetary authorities to prevent strong portfolio inflows and rising export receipts from strengthening their currencies.

There have been worries that Asia might be starting to diversify its reserve holdings as the dollar weakens. However, this is a trend that is hard to pin down.

"The bottom line is that the US data suggest some diversification is underway in Asian reserves, but it is not yet clear who is the key beneficiary," Allison Montgomery, a currency strategist with Westpac Bank, said in a report.

"Oil may be a (limited) option, but the European and Japanese bond trends warrant monitoring."

US Treasury data showed that net capital inflows in September fell to a five-year low of $4.2 billion, but US Federal Reserve data shows that foreign central banks were large buyers of US Treasuries through November.

The US Treasury data also showed that during September, holdings of Treasuries by investors -- private and official sector -- in Japan, Korea and Taiwan rose, but fell in China.