China Urges US To Handle Debt Responsibly

BEIJING (AP) - China's central bank governor urged Washington to handle its debt responsibly, warning Wednesday that uncertainty in the market for Treasury debt might harm a global economic recovery.

China is the biggest foreign owner of Treasury debt and had appealed to U.S. leaders to protect its $1.1 billion in holdings during last week's debate over raising Washington's borrowing limit and avoiding a possible default.

In a statement, Zhou Xiaochuan welcomed the deal by American leaders to raise the limit but also called for Washington to avoid further steps that might hurt investors.

"Large fluctuations and uncertainties in this market would undermine the stability of the international financial system and hinder global recovery," Zhou said. The central bank took the unusual step of posting his comments in both English and Chinese on its website, clearly aiming to reach a foreign audience.

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