China tells U.S. to manage flood of dollars with care

David Lawder and Sue Pleming
Reuters
Tuesday, July 28, 2009

WASHINGTON (Reuters) – A top Chinese official said on Tuesday the United States should be careful about flooding global markets with dollars while the world struggles to restore economic stability and get growth back on track.

Sitting beside U.S. Treasury Secretary Timothy Geithner, Chinese Vice Premier Wang Qishan made clear at the start of the concluding day of the “Strategic and Economic Dialogue” that China has concerns about its U.S. investments.

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“As a major reserve currency-issuing country in the world, the United States should properly balance and properly handle the impact of the dollar supply on the domestic economy and the world economy as a whole,” Wang said.

China is the United States’ biggest creditor, holding $802 billion of U.S. Treasury securities on May 31, and Washington needs Beijing to keep buying its debt to finance a budget deficit estimated to hit $1.8 trillion this year.

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