John Jay
08-12-2007, 02:25 PM
China talks up importance of its US dollar reserves
Agence France-Presse
Last updated 01:55pm (Mla time) 08/12/2007
BEIJING--China said Sunday it highly values its US dollar holdings, in comments apparently aimed at easing concerns it plans to sell off some its huge forex reserves.
"US dollar assets, including US government bonds, are an important component of China's forex investment repertory due to the dollar's important position in the world currency system, and the capacity and liquidity of the US financial system," official Xinhua news agency quoted an unnamed central bank official as saying.
"China is a responsible investor in world financial markets. Our objectives in managing our forex reserves are stability, liquidity and investment returns and we have a long-term and strategic view," said the official with the People's Bank of China.
Britain's Daily Telegraph newspaper had reported recently that China was threatening to sell off US dollar assets in retaliation for growing calls in Washington for sanctions against Beijing for allegedly manipulating its own yuan currency.
The report prompted a response by US President George Bush, who warned that any such pressure by China would be "foolhardy."
Faced with a massive and growing trade deficit with China, US lawmakers are pushing for legislation to allow for sanctions against Beijing over what is seen as its manipulation of the yuan exchange rate to gain a trade advantage.
The central bank official said China also places high importance on stable, mutually beneficial trade and economic ties with the United States.
"Sino-US economic and trade relations are closely interrelated. This has a stabilising role not only for the two economies but for the world economy," the official said.
"We have all along placed the highest importance on, and helped to promote, harmonious Sino-US economic ties."
China has more than $1 trillion in foreign reserves.
http://business.inquirer.net/money/breakingnews/view_article.php?article_id=82060
Copyright 2007 Agence France-Presse. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Agence France-Presse
Last updated 01:55pm (Mla time) 08/12/2007
BEIJING--China said Sunday it highly values its US dollar holdings, in comments apparently aimed at easing concerns it plans to sell off some its huge forex reserves.
"US dollar assets, including US government bonds, are an important component of China's forex investment repertory due to the dollar's important position in the world currency system, and the capacity and liquidity of the US financial system," official Xinhua news agency quoted an unnamed central bank official as saying.
"China is a responsible investor in world financial markets. Our objectives in managing our forex reserves are stability, liquidity and investment returns and we have a long-term and strategic view," said the official with the People's Bank of China.
Britain's Daily Telegraph newspaper had reported recently that China was threatening to sell off US dollar assets in retaliation for growing calls in Washington for sanctions against Beijing for allegedly manipulating its own yuan currency.
The report prompted a response by US President George Bush, who warned that any such pressure by China would be "foolhardy."
Faced with a massive and growing trade deficit with China, US lawmakers are pushing for legislation to allow for sanctions against Beijing over what is seen as its manipulation of the yuan exchange rate to gain a trade advantage.
The central bank official said China also places high importance on stable, mutually beneficial trade and economic ties with the United States.
"Sino-US economic and trade relations are closely interrelated. This has a stabilising role not only for the two economies but for the world economy," the official said.
"We have all along placed the highest importance on, and helped to promote, harmonious Sino-US economic ties."
China has more than $1 trillion in foreign reserves.
http://business.inquirer.net/money/breakingnews/view_article.php?article_id=82060
Copyright 2007 Agence France-Presse. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.