Saturday, June 25, 2011

A glimmer of hope for the bulls

Further to my recent post entitled China to the rescue? Bloomberg reported that Chinese Premier Wen Jiabao stated that China will continue to buy European sovereign debt, including Hungarian government bonds, and support the euro:
China pledged to buy Hungarian government bonds and said it will “consistently” support the euro as Europe battles to fight its way out of a sovereign debt crisis.

China will buy a “certain amount” of Hungarian government bonds and remains a “long-term investor” in European debt markets, Chinese Premier Wen Jiabao said in Budapest today. This afternoon, Wen travels to the U.K. and then on to Germany on his three-country European tour.

“China is a long term investor in Europe’s sovereign debt market,” Wen said in translated comments at a press conference with Hungarian Prime Minister Viktor Orban. “In recent years we have increased by quite a big margin our holdings of government bonds. We will consistently continue to support Europe and the euro.”
Whether the "certain amount" is a token amount or the sign of significant commitment, it's impossible to know. Nevertheless, this is a glimmer of hope for the bulls in a world that is increasingly tilting bearish.

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