Wen Jiabao: China to buy U.S. treasury bonds depends on its ability to preserve and increase the
Premier Wen Jiabao today will put an end to a three-day visit to the UK, and the United Kingdom is also Premier Wen Jiabao to Europe "confidence trip" last stop.
In the January 31 into Chinatown to the overseas Chinese New Year, to the Bank of China to visit staff in the British financial institutions, Wen Jiabao welcomed a series of questions, in answer to the "China will buy more U.S. bonds," the Wen Jiabao respond with humor: "This is a very sensitive issue, but also President Obama is very concerned about.
"Wen Jiabao said that China's foreign exchange reserves increased rapidly these years. China's diversification of foreign exchange reserves to buy U.S. treasury bonds is an important part." Whether it will continue to buy, how much to buy, it should be in accordance with China's needs, according to the Exchange security, preserving and increasing demands. "
As for the "Currently the RMB exchange rate is reasonable," the question, Wen said that China adopted the reform of RMB exchange rate formation mechanism, in accordance with the needs of the market changes, a reference basket of currencies, to implement a managed floating exchange rate system. For more than three years, the RMB against the U.S. dollar effective exchange rate of 21 percent. In the RMB exchange rate issue, China can not just parroting, especially in the face of financial crisis, maintaining the RMB exchange rate at a reasonable and balanced level of stability is of paramount importance. This will not only benefit China, but also conducive to the world economy.
In addition, how to rescue the market issue, Wen said countries in the world are in large-scale government investment, but many countries, "rescue the market" is still in the Security Bank, and China put forward four trillion investment plans are invested to the real economy is to implement structural policy of tax cuts, giving benefits to businesses and ordinary people, introduced to the countryside home appliances, agricultural machinery to the countryside, automotive countryside, are a variety of subsidies to promote consumption, "we do not have to spend money to fill holes in banks . " Earlier, in January 28 at the 2009 Davos forum, Wen Jiabao, in particular, his speech has pointed out that some countries, financial institutions, one-sided pursuit of profits of over-expansion; financial and lack of self-rating agencies, resulting in the risk of information and asset pricing Distortion; capability in financial supervision and financial innovation does not match the risks of financial derivatives to accumulate and spread in the world financial crisis reasons.