foreign currency reserves

China Diversifying Away From The Dollar

The Wall Street Journal highlights new U.S. Treasury data which indicates that China has reduced its U.S. dollar holdings as it begins to diversify its $3.2 billion stockpile of foreign currency reserves: “It clearly...

China's Foreign Reserves Dilemma

Chinese policymakers are faced with the challenge of diversifying their foreign currency holdings. While the U.S. is rushing to legislate the borrowing limit, China must make some tough decisions regarding its portfolio. From...

The Demise of the Dollar?

The Independent published an allegedly “exclusive report” by Robert Fisk that several countries, including China, Russia, Japan, France and Gulf states had met secretly to find ways to stop using the U.S. dollar as...

China Tries to Wriggle Out of the US Dollar Trap

From the introduction to an article on YaleGlobal by Wenran Jiang: While the world waits for China to flex its economic muscle to ease the crisis, China’s exposure to the US dollar is a bigger issue with which the country has to...

China Slows Purchases of U.S. and Other Bonds

From the New York Times: Reversing its role as the world’s fastest-growing buyer of U.S. Treasuries and other foreign bonds, the Chinese government actually sold bonds heavily in January and February before resuming purchases in...

Growth In Chinese Forex Reserves Slows

From Financial Times: China’s foreign exchange reserves grew at their slowest pace in more than two years in June, prompting questions over whether the flow of speculative capital into China was slowing as a result of government...

China Banks Learn To Say No To Risky Deals

American investors hopeful the Chinese government’s deep, wide-open pockets will come to the rescue of ailing U.S. stocks may not be happy to hear this news. From Reuters: After China’s state-controlled CITIC...

Chinese Cash Turns in New Directions – Peter Garnham

Andy Xie, Morgan Stanley’s former star economist, recently said that China would become a very hot spot for investors. Meanwhile in China, both governmental and nongovernmental cash flow, derived from huge foreign exchange reserves, is heading for overseas investment. From The Financial Times: The slowing pace of China’s accumulation of foreign exchange reserves has underlined […]

China To Redefine Foreign Direct Investment – Sung Hin Jason Chan

From China Rising: One of China’s leading economists, Professor Lin Yifu , recently said of China’s position in the world: 4th in GDP, 3rd in Trade, 2nd in Foreign Direct Investment and 1st in Foreign Exchange Holdings . Perhaps the fact that China is second and first in areas that has the word “foreign” in […]

China’s Hollow Threat to Dump U.S. Bonds – Peter Morici

From Robert H. Smith School of Business website: The Congress is growing impatient with China’s currency manipulation and export subsidies, and is near passing legislation that would require the Bush Administration to strike back. Faced with the prospect of trade competition on a level playing field–something the Chinese Communist Party fears more than free elections–the […]

China Affirms Dollar’s Global Reserve Status – Richard McGregor

From FT: Beijing on Sunday sought to repair fallout from reports it could use its $1,330bn foreign exchange holdings to put pressure on Washington and the dollar with a statement affirming the importance of the US dollar as a global reserve currency. The official Xinhua news service quoted an anonymous official at the People’s Bank […]

China’s Threat to the Dollar is Real – Paul Craig Roberts

From CounterPunch: Twenty-four hours after I reported China’s announcement that China, not the Federal Reserve, controls US interest rates by its decision to purchase, hold, or dump US Treasury bonds, the news of the announcement appeared in sanitized and unthreatening form in a few US news sources. The Washington Post found an economics professor at […]

China Foreign-Exchange Reserves Reach $1.33 Trillion – Nipa Piboontanasawat and Lee Spears

From Bloomberg: China’s foreign-exchange reserves, the world’s largest, climbed to a record $1.33 trillion at the end of June, increasing pressure on the government to allow faster yuan gains. “China’s foreign reserves are too big and mopping up the liquidity that fuels inflation and asset bubbles is an administrative headache,” said Simon Derrick, chief currency […]

China to Buy a Stake in Blackstone – Andrew Ross Sorkin & David Barboza

From the New York Times: The Chinese government said yesterday that it would acquire a $3 billion stake in the Blackstone Group, the private equity firm, in the country’s first effort to diversify its $1.2 trillion in foreign-exchange reserves beyond United States Treasury bills and into commercial enterprise. The deal, which is set to coincide […]

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