Benn Steil

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China vs. U.S. Central Bank Holdings

by
July 27, 2009

2009730centralbanksflippedcolors

China has expressed concern that the growth of the Federal Reserve’s balance sheet will adversely affect the value of its dollar reserves. But China has plenty of experience of its own with rapid balance sheet growth. The PBOC’s balance sheet is a larger share of China’s GDP than the Fed’s balance sheet is of U.S. GDP. Does China’s own experience sterilizing rapid growth of its central bank balance sheet provide a hint about the U.S.’s future?

Economist: China and the Dollar
FT: China Attacks Dollar’s Dominance
Derrick: Geithner Must Reassure China
Wolf: It is in Beijing’s Interests To Lend Geithner a Hand

Post a Comment 2 Comments

  • Posted by frank

    this chart could be less confusing if you reverse the colors!

  • Posted by geographics

    Frank – Good point. Will flip the colors so that the Fed is blue and PBoC is red.

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