China Should Add Dollar Assets In FX Reserves As Dollar Rebounds: Newspaper

China should consider increasing the allocation of U.S. dollar assets in foreign exchange reserves, adhere to a prudent monetary policy, improve global policy communication and establish a risk warning system to effectively respond to the impact of the shift in U.S. monetary policy, said the Economic Daily in a commentary. The rebound of the dollar index will help ease the continued appreciation pressure of the Chinese yuan, though the currency will still be supported by China’s exports and tend to fluctuate in two ways, the newspaper said. The narrowing China-U.S. interest spread may lead to faster foreign capital outflows, and commodity prices may become more volatile, the newspaper said.