favourite blog Wang said.

to reduce risks, Wang said.
The SAFE restated last month that it will continue to press ahead with the diversification of its forex reserves .
However, the structure of China's forex reserves cannot be adjusted soon favourite blog , as the greenback remains a relatively safe area for investment compared with other currencies, and supplies of other types of assets are not large enough to digest China's huge forex reserves favourite blog , Wang said.
INFLATION WORRIES
China also faces rising imported inflationary pressure favourite blog , as the debt deal will push up prices of international commoditiesprom shoes, which may undermine the government's efforts to keep prices in check.
An increasingly heavier debt burden on the U.S. economy will dampen global purchases of the dollar and shift global investment to international commodities, which will in turn drive prices of commodities higher, said Wang Guoxing, vice head of the Pudong Institute for the U.S. Economy.
China's inflation escalated to a three-year high of 6.4 percent in June. To put a lid on stubbornly high prices, the central bank has raised interest rates three times and increased its reserve requirement ratio for banks six times so far this year.
The tightening measures have slowed the country's manufacturing activity, with the Purchasing Managers' Index dropping to a 29-month low of 50.7 percent in July.
"The PMI data has been falling for months and there is still no sign of stabilizing favourite blog , so I think the government should keep its current policy mix for sometime," Wang Jun said.
He said that he expects the Chinese government will not tighten its policies any further, as the economy is slowing and enterprises are suffering financing difficulties.
The central bank said on Monday that the government will keep a prudent monetary policy for the rest of the year.
LONG-TERM RISKS
Raising the debt ceiling has allowed the U.S. to avoid a disastrous debt default, which may be a positive sign for its fragile economic recovery, said Lu.
However,