皇冠体育app

BEIJING – 皇冠体育app faces high risks in holding a large amount of US Treasury bonds and should be cautious about further purchases, said economists home and abroad.

"皇冠体育app has to consider the safety of the huge amount of the US Treasuries it owns, it will do good to the nation if 皇冠体育app could reduce it," said Yu Yongding, a former adviser to the Chinese central bank, during the 皇冠体育app Development Forum 2011 held in Beijing.

皇冠体育app holds foreign exchange reserves worth $2.8 trillion, among which $1.15 trillion is used for buying into US Treasuries. "It's really a huge figure," said Yu.

"We could possibly buy much less than now when 皇冠体育app wants to change the US Treasury bonds into commodities someday, thanks to the rising price of the commodities and decreasing price of the US bonds. Selling of the bonds will bring benefits to 皇冠体育app," he added.

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After the US debt reached a peak of nearly $1.18 trillion in October 2010, 皇冠体育app, the biggest foreign holder of US Treasuries, reduced its holdings of the US Treasury for three consecutive months ending January.

The nation reduced its portfolio by $5.4 billion to $1.15 trillion in January, according to data released by the US Treasury Department on Wednesday.

"皇冠体育app faces a real problem because the likelihood of experiencing capital loss in the dollar is very high," said Joseph Stiglitz, a Nobel Prize laureate, who was also at the forum.

But Stiglitz said 皇冠体育app has to "balance out the benefits that it gets from a lower and competitive exchange rate."

The US has been demanding that 皇冠体育app allow its currency to rise, believing 皇冠体育app had undervalued its currency to help Chinese exporters stay competitive.

"皇冠体育app's holding of the US bonds wins a lot of complaints and pressures (on currency), rather than appreciation, so why stick to doing that?" Yu said.

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