Doubts about US debt quality remain, says state media

China remains concerned about US debt, despite an 11^th-hour deal struck by Congress to lift the debt ceiling, according to a commentary published in the People’s Daily, the official newspaper of the Chinese Communist Party, Reuters reported. “Although the US has basically avoided default, its sovereign debt problems remain unresolved. They have merely been pushed off, and there is a tendency for them to grow,” the paper said in a commentary. However, the editorial also noted that no viable alternative exists as a global reserve currency. While not necessarily a reflection of China’s senior leadership, the editorial’s statements indicate that Beijing is nervous about its exposure to US debt via the country’s foreign exchange reserves. Chinese officials generally avoided public comment on US debt during recent political brinkmanship in the US Congress over raising the debt ceiling.