from Marketwatch:
Chinese bank authorities warned the Federal Reserve's programs to pump more cash into the financial system by buying $300 billion in Treasurys risked jolting bond prices and devaluing the dollar.
The overnight comments from the world's biggest holder of U.S. government debt helped depress Treasury prices in trading Thursday, said one analyst.
In a monetary report dated Wednesday and posted on the People's Bank of China's Web site, the central bank said the quantitative easing policy pursued by the Fed may help keep bond yields at low levels in the short term.
But over a longer period, higher inflation expectations, interest rates and central bank measures to take extra liquidity out of the system could cause a sharp adjustment to bond prices, the report said.
The central bank also said plans by the Fed and other central banks to drive lending rates lower by buying their own government debts risks depreciating major currencies.
