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Asia to suffer from U.S credit downgrade

08-08-2011 14:36 BJT

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The US credit rating cut has aroused concerns worldwide, with some analysts labeling it a "lose-lose" situation for the US and Asia. They add the downgrade threatens major losses for China and other Asian countries that hold US debt.

Francis Lun, managing director of Lyncean Holdings said, "The US government will have to pay more for their treasury, and that means the US government bonds, the price of the US government bonds will fall. China holds about 1.1 trillion US dollars in US government debt, Japan holds about one trillion, and if the price drops by one percent, then China will suffer an eleven billion US dollar in paper loss immediately, and Japan will suffer a ten billion US dollar paper loss immediately. The rating downgrade is really a lose-lose situation, the US suffers, and Asia suffers too."

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Editor:Li Wanran |Source: CNTV.CN

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