August 08,2007

Grassley Urges Chinese Leaders to Clarify “Nuclear” Option on U.S. Treasury Holdings

Sen. Chuck Grassley, ranking member of the Committee on Finance, today expressed concern over comments from Chinese officials that China may liquidate its holding of U.S. treasuries if Congress tries to force a revaluation of the Chinese currency. Grassley made the following comment on his concern and wrote to the Chinese ambassador. The text of his letter follows.

“These types of threats are counterproductive and dangerous. They’ll only harden people’s views that China is purposely manipulating its currency to gain economic advantage. But they won’t stop the United States from taking steps to encourage China to float its currency as a mature economic power. The Chinese government’s leaders should clarify whether these comments are official government policy.”

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