US bailout 'positive' move for markets

The government takeover of beleaguered mortgage finance giants Fannie Mae and Freddie Mac will benefit its debt holders, but could pose questions for major holders of US treasury bonds, such as China and Japan, analysts said.

But the central bank described the move as positive. "Chinese investors have a certain amount of exposure" to the companies, Zhou Xiaochuan, governor of the central bank, said yesterday.

"I think they welcome the new policy, but we still need time to have a further study. From my point of view, I think this is positive."