China fund may cut US debt holdings: Report

SHANGHAI (AFP) - China's sovereign wealth fund, which has more than US$480 billion (S$588 billion) in assets, could cut holdings of US Treasury Bonds as they are becoming a less attractive investment, state media said on Tuesday.

The Shanghai Securities News quoted Mr Lou Jiwei, chairman of sovereign wealth fund manager China Investment Corp (CIC), as telling a conference in Hong Kong on Monday that the US economic recovery had made other investments appealing.

China has the world's largest foreign exchange reserves and according to US government figures is the largest foreign holder of US Treasuries with US$1.16 trillion at the end of October last year, the latest available statistic.

"In line with the future US economic recovery, the appeal of US debt is weakening," Mr Lou said. "From a long-term perspective, it is not a good investment target."