|The Standard and Poor's building in New York, August 2, 2011. The U.S. Treasury Friday night hit back against a Standard and Poor's downgrade of U.S. top-notch credit rating, saying that the agency's judgment was flawed. (Xinhua/Reuters Photo)
Standard & Poor's (S&P) last Friday downgraded the U.S. credit rating from its top-notch AAA to AA-plus for the first time ever, just days after the U.S. government narrowly escaped an unprecedented debt default.
BEIJING, Aug. 8 (Xinhuanet) -- Last Tuesday U.S. President Barack Obama signed a bill lifting the nation's debt limit through 2013 and cutting the deficit by more than 2 trillion U.S. dollars.
The United States raising its debt ceiling is a double-edged sword to China. In the short term, the US economy avoids suffering from a "double dip" and introduces the third round of the quantitative easing policy, which will reduce the global financial market risk. This is conducive to China's steady economic growth because the United States is one of China's most important export markets and is also conducive to the security of China's U.S. dollar assets and keeps the exchange rate of the RMB against the U.S. dollar stable.
In the long term, the current dispute between Republicans and Democrats on the debt ceiling warns China that the United States will ignore the interests of creditors for the needs of domestic political struggles.
China side-steping U.S. financial crisis with innovative strategies
BEIJING, Aug. 8 (Xinhuanet) -- After watching Congress play politics and care not a whit about upholding the honor of United States, can the world assume that America is not about to become a deadbeat to beat all deadbeat nations in history?
Even if the United States Treasury eventually honors its obligations after undergoing the tortuous exercise between House, Senate and the White House, will the rest of the world continue to have faith and confidence in the value of the dollar?
China, the country that holds more U.S. federal debt than any other foreign country, is taking action to sidestep potential future U.S. default. Full story
U.S. debt ceiling deal is double-edge sword for China
BEIJING, Aug. 8 (Xinhuanet) -- The roller-coaster debate over raising the US national debt ceiling finally concluded after the two parties made compromises. The Democratic Party-led administration removed the political restraint of debt default before the general election in 2012, and the Republican Party-led House of Representatives secured a promise to cut government spending over the next decade.
The two parties had threatened each other using the interests of global creditors, staging a preview of next year's general election. Meanwhile, the hidden trouble in the global financial market and economic recovery has temporarily been avoided. Full story
Time to reconsider buying of US assets
BEIJING, Aug. 8 (Xinhuanet) -- While the Chinese government made it clear that it was unhappy about the possibility that the United States could default on its debt, it was also clear that China's concerns are not a major factor in US politics.
The United States has always been an incredibly insular country. The vast majority of the public has very little interest in or concern for what is going elsewhere in the world, except insofar as it directly affects the US. Full story
Obama signs debt ceiling bill, China vows to diversify forex investment
WASHINGTON, Aug. 2 (Xinhua) -- U.S. President Barack Obama Tuesday signed a bipartisan bill on raising the nation's debt limit into law, hours before the federal government runs out of borrowing capacity, ending a month-long perilous stalemate.
Obama signed the bill into law less than two hours after the measure cleared the U.S. Senate with a 74-26 vote to avert a potentially catastrophic debt default risk. Full story
Chinese rating agency downgrades U.S. credit rating after debt limit increase
BEIJING, Aug. 3 (Xinhua) -- Chinese rating agency Dagong Global Credit Rating Co. said Wednesday it has cut the credit rating of the United States from A+ to A with a negative outlook after the U.S. federal government announced that the country's debt limit would be increased.
The decision to lift the debt ceiling will not change the fact that the U.S. national debt growth has outpaced that of its overall economy and fiscal revenue, which will lead to a decline in its debt-paying ability, said Dagong Global in a statement. Full story
China's stocks down to 7-week low following U.S. market slump
BEIJING, Aug. 5 (Xinhua) -- China's stocks joined a global plunge in equity markets Friday by tumbling more than two percent to a seven-week low, after a sharp overnight drop in the U.S. stock market triggered investor worries of new round of global economic crises.
The benchmark Shanghai Composite Index slumped 2.15 percent to close at 2,626.42. The Shenzhen Component Index edged down 1.95 percent to finish at 11,701.76. Full story
Video: What can China do to prevent imported inflation after U.S. raised debt ceiling?
It's time for U.S. to stop blames, take responsibility
NEW YORK, Aug. 7 (Xinhua) The White House on Saturday challenged the ruling by Standard & Poor's to downgrade U.S. long- term credit rating form top rank of AAA to AA+, citing the agency' s decision relied on faulty math and in haste.
Disappointingly, instead of reflecting on themselves and sitting down to fix problems in a cooperated way, the Democrats and Republicans in Washington are questioning the creditability of the downgrade ruling and blaming each other for the ever-first shame of slipping out top credit rating club. Full story
Global Review: A tough summer for the world
BEIJING, Aug. 7 (Xinhua) -- With droughts, flooding or cyclones, summer is usually a disaster-prone season. What makes our lives tougher, however, is political events.
In the United States, the tug of war between Democrats and Republicans over the issue of the U.S. debt ceiling ended as President Barack Obama signed a bill hours before the Aug. 2 deadline to raise the nation's debt limit in exchange for deficit cuts. Subsequently, the U.S. sovereign credit rating was downgraded from a gold-plated AAA to AA+ by Standard & Poor's, one of the world's leading credit rating agencies. Full story
U.S. debt problem remains unsettled
BEIJING, Aug. 6 (Xinhua) -- Far from an end to the U.S. debt problem, the last-minute congressional approval of an increase in the debt limit is merely a technical time-out.
President Barack Obama on Wednesday signed legislation to increase the U.S. debt ceiling, after Congress voted in favor of a compromised bipartisan deal. Full story
U.S. debt crisis
S&P downgrades U.S. credit rating
Backgrounder: U.S. debt default risks
Backgrounder: Key facts about U.S. debt limit fight