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The
Fed move "will inevitably cause fresh financial turbulence, and
worsen the situation of those countries that overly depends on
external financing and are insufficiently capable of paying
(off) debt, especially those emerging markets," Xinhua said on
Thursday.
On Thursday, China's yuan <CNY=CFXS> fell to its weakest level
in eight-and-half years against a broadly stronger U.S. dollar,
after the Fed raised interest rates by 0.25 basis points and
projected more interest rate increases than previously expected.
Earlier this month, Chinese Vice Finance Minister Zhu Guangyao
said in a media interview that a rate hike would mean heightened
capital outflows for all markets, including China.
The Fed move comes shortly after China reported that its foreign
reserves at end-November were at the lowest level in nearly six
years. The central bank last month sold a net $55.4 billion
worth of foreign exchange, the highest since January.
"If the United States accelerates its rate hike pace in the
future, a stronger dollar would bring disorder worldwide" as
different countries have different interest rates, Xinhua said.
The commentary said it was "advisable" for the U.S. to enhance
coordination with other major economies on macro policies, and
prudently handle the pace of rate hikes.
Xinhua commentary added that it was "questionable whether the
U.S. economy itself has the capability to sustain the possible
fast-pace rate hikes indicated by the Fed".
(Reporting by John Ruwitch and Yawen Chen; Editing by Richard
Borsuk)
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