China vs. U.S. Central Bank Holdings

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