Fewer T-bills in China

A senior economist at China’s State Council said China planned to buy fewer US Treasury bills and instead purchase assets related to other currencies, the Los Angeles Times reported. After Japan, China had the world’s largest stock of foreign exchange reserves, of which some 75% were in the US dollar-backed assets. Analysts said even a small change in this direction could push the dollar down. Many economists expected a big drop in the dollar if US trade and fiscal deficits continued to grow.