Zhou Xiaochuan, governor of the People's Bank of China (PBC), said on November 10 while attending a European Central Bank Conference in Germany, that a pluralized foreign reserves policy had been implemented for many years and would continue. China will not rush to sell US dollars to diversify foreign reserves.

Days ago, a report came from Hong Kong that China had drafted a policy to decentralize foreign reserves, and that Zhou Xiaochuan had said that China would diversify US$1 trillion into other currencies and new markets. As a result, the value of the Euro grew enormously on the international money market. .

Zhao Xijun, Deputy Director of Financial and Securities Institute of Renmin University of China, believes that is likely that people with ulterior motives spread this rumor to create panic. Although the value of the US dollar is falling, it remains the primary currency of Chinese foreign reserves. In these circumstances, it is impossible for PBC to undersell a large amount of US dollars. While foreign reserves are swelling, the PBC can augment the proceeds of foreign reserves by diversifying the types of capital investment into such things as gold and securities.

By People's Daily Online