China's FX regulator denies losses in Fannie Mae, Freddie Mac bonds

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China's foreign exchange regulator said Friday it did not suffer any losses from its investment in Fannie Mae and Freddie Mac bonds, adding that media reports of up to 450 billion U.S. dollars of losses were "groundless."

"Up until now, the capital and interest repayments of Fannie Mae and Freddie Mac bonds is normal, and no losses have incurred," The State Administration of Foreign Exchange (SAFE) said on its website.

Annual yields of the bonds were around 6 percent between 2008 and 2010, the SAFE said.

The regulator, which oversees China's more than 2 trillion U.S. dollars of foreign exchange reserve, also clarifies it had not bought any stocks of the two troubled mortgage companies.

UPI reported on Friday that the Obama Administration will propose phasing out the two mortgage giants after rescuing them, which is part of a U.S. Treasury Department white paper to Congress that lays out three ways of cutting government support to the 10.6 trillion U.S. dollars mortgage market.

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