Beijing, Aug. 31: China on Tuesday denied rumours that the country’s central bank governor Mr Zhou Xiaochuan had fled after the bank posted huge bond losses, a report said.
Several Chinese websites reported Monday that the People’s Bank of China had incurred a $430-billion loss on bonds from US mortgage giants Fannie Mae and Freddie Mac and that Beijing might punish some people including Zhou.
The websites cited the Ming Pao Daily as their source, but the Hong Kong newspaper denied publishing any such articles, Dow Jones Newswires reported.
The reports fuelled rumours among Chinese Internet users that Mr Zhou had left the country.
“They say that Governor Zhou has fled...,” said central bank deputy governor Mr Hu Xiaolian. “But in actual fact Zhou was chairing a PBOC meeting.”
Chinese shares were down 0.44 per cent in afternoon trade.
“Usually market volatility is in response to economic news, data or analysis. People will speculate on such factors. But to speculate on this sort of thing is extremely abnormal,” Mr Hu said.
The central bank was at pains to prove Mr Zhou was at work, issuing two statements Monday with photos of the PBOC governor meeting with a Japanese official and a former Italian official.
Japan’s financial regulator also confirmed that its chief Mr Shozaburo Jimi met with Chinese central bank governor in Beijing on Monday.
Another picture of the Chinese central banker on Monday meeting former Italian finance minister, Mr Tommaso Padoa Schioppa, was also posted on the website.
Ms Paola Paderni, a spokeswoman for the Italian Embassy in Beijing, said she couldn’t confirm the meeting as it wasn’t arranged through the embassy.
The Ming Pao Daily said its “editorial department clarifies that it hasn’t made any such report, and it strongly condemns the act of using Mr Ming Pao’s name to spread false information.”
The newspaper said it had reported the incident to the Hong Kong police and mainland authorities.The central bank declined to comment .
Two US government officials said Mr Zhou was not in US custody.