In response to a media report saying, "China threatens to trigger a US dollar crash," the central bank said in Beijing on Sunday that China is a responsible investor in the international financial market.
On August 8, UK media published an interview with two senior Chinese officials who allegedly warned that Beijing may use its 1.33 trillion of foreign reserves as a bargaining chip in talks with the US on issues such as yuan revaluation.
China's forex management is focused on safety, liquidity, and rate of return and adheres to a long-term strategic policy, the People's Bank of China (PBOC) announced in a statement.
In determining the structure of its monetary assets, Beijing chiefly considers foreign trade, evolution of the international monetary system, trends in international capital, and the forex market, said the PBOC.
US dollar assets, including US treasury bonds, are an important component of China's forex reserves investment as the dollar plays an important role in the international monetary system while the US financial market has huge capacity and high liquidity, the PBOC added.
China and the US have a close economic relationship, which has great impact not only on the steady economic development of the two countries, but also on the stable development of the world economy, it said.
China always attaches great importance to the harmonious development of Sino-US trade and to strengthening communications and exchanges through channels such as the Sino-US strategic economic dialogue, according to the PBOC.
Such communications and exchanges would help promote mutual understanding and cooperation on the basis of consensus and would contribute to economic prosperity in both countries for the benefits of the two peoples, the statement said.
(Xinhua News Agency August 13, 2007)
