China Forex Regulator: No Need For Big Shift In Reserves
News Archive - Industry Headline - September news
(Easybourse, Sept 17, 2006) -- SHANGHAI - There's no need for any big shifts in the composition of China's foreign exchange reserves, said the head of China's foreign exchange regulator, according to comments published on Sunday.
"Until now we haven't made a huge adjustment to our reserves composition because China's foreign trade is largely in U.S. dollars," Hu Xiaolian, head of China's State Administration of Foreign Exchange said. "In the basket, the U.S. dollar comprises a quite large portion of it, so there's no need to shift greatly from this," she said.
The comments were published in Emerging Markets, a free paper published during multilateral development bank meetings. It wasn't clear when Hu was interviewed for the article.
Hu said that diversifying the foreign exchange reserves has been a long-standing practice. "Over the past few years, we have already diversified our reserves away from exclusively U.S. dollars to other currencies - euro, yen, and we have also now moved to the Korean won," Hu said.
China's foreign exchange reserves stood at $954.5 billion at the end of July, according to China Vice President Zeng Qinghong's essay posted on a Web site earlier this month.
As the dollar weakens globally there's been mounting concern that China needs to further diversify its reserves to avoid losses. Some Chinese economists have suggested that China use its forex reserves to buy oil or gold.
The composition of the forex reserves are kept secret.
Source:Easybourse
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