Economy

China says Europe a key investment market

(Agencies)
Updated: 2010-05-27 17:30

BEIJING: Europe remains a key investment market for China's foreign exchange reserves, the Chinese central bank said on Thursday, helping to soothe markets unnerved by a report that it was reviewing its euro-zone bond holdings.

The Financial Times said on Wednesday that China's State Administration of Foreign Exchange (SAFE) was meeting foreign bankers because of concerns about its exposure to debt troubles in Europe.

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That report was groundless, said SAFE, which manages China's $2.4 trillion in foreign exchange reserves.

"China is a responsible and long-term investor in the investment of foreign exchange reserves and we always follow the principle of diversification," it said in a statement on the central bank's website.

"Europe was, is and will remain one of the major investment markets for China's foreign exchange reserves," it said.

It also said that China was confident that the euro zone would be able to overcome its difficulties, adding that the country supported the actions taken by the International Monetary Fund and the European Union to stabilise financial markets.