Former Adviser to China’s Central Bank Advised Not to Invest in Euro Debt

Former adviser to China’s central bank Yu Yongding (余永定) suggested that it is not worth investing in debt of EU countries.

Also, the economist suggests that China was in no hurry to invest in foreign currencies and should strengthen the yuan, reduce the dependency on dollar. RBC is considering these proposals as a possible step to transform RMB to an reserve currency.

Currently China is the world’s largest holder of U.S. debt bonds.

Chinese authorities have also previously argued for the possibility of buying debt of the euro area, which is now undergoing major debt crisis. The EU is one of China’s largest markets, which makes the country interested in preserving the stability of the eurozone.