The default deadline has entered a countdown as negotiations to raise the US debt ceiling have stalled.
China, one of America’s biggest checks and one of its largest creditors, is neither crying nor laughing.
Why? Correspondent Kang Jeong-kyu in Beijing reports.
[기자]
Debt ceiling negotiations are bogged down in a tense tug-of-war between the White House and Republicans.
Treasury cash balances are bottoming out at less than $50 billion.
On the 1st of the following month, the default (default) deadline entered a countdown.
[조 바이든 / 미국 대통령 : 매카시 의장과 협상은 예산의 윤곽에 관한 것이지, 디폴트에 관한 게 아닙니다.]
[케빈 매카시 / 미 공화당 소속 하원의장 : 모두가 동의하기 전에 합의는 없습니다. 아직 해결해야 할 몇 가지 문제가 남아 있어요.]
China, which owns $870 billion of US Treasury bonds, has no choice but to fret.
This is because an actual default would lead to a collapse in bond values, followed by a decrease in foreign exchange reserves.
Fortunately, among the misfortunes, China, which was the largest creditor of the United States, has sharply reduced its holdings in conflict with the Trump administration.
Instead, Japan has emerged as the largest creditor, and has now amassed $1.1 trillion.
If the US defaults, it could be another opportunity for China to challenge the dollar’s hegemony.
[마오닝 / 중국 외교부 대변인 (지난 23일) : 미국이 책임 있는 재정·통화 정책을 채택해서 전 세계에 위험을 전가하지 않길 바랍니다.]
This is why China is ambiguous whether to cry or laugh at the unprecedented US default crisis.
This is YTN Jungkyu Kang from Beijing.
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#China #cry #laugh #midst #default #crisis…why
2023-05-26 12:31:00
