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China's Treasuries Hoard Seen as Next Line in the Sand After Yuan's Drop

From bnnbloomberg.ca

The yuan’s plummet to a decade-low has analysts and investors casting a wary eye toward China’s $1.1 trillion pile of U.S. Treasuries. The idea that China -- America’s biggest foreign creditor -- would dump its U.S. debt holdings wholesale as a way to retaliate in the trade war is often dismissed as improbable. For one thing, analysts say, there aren’t many other viable places for it to park its $3.1 trillion in currency reserves. However, the yuan’s plunge on Monday past 7 per dollar -- long seen as a line in the sand for Chinese authorities -- shows the possibility can’t be ruled out, according to Stephen Roach, a ... (full story)

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  • Category: Fundamental Analysis