Stock markets around the globe have been tumbling since S & P's downgraded the US credit rating for the first time in seventy years.

It's predicted the downgrade would result in a massive sell-off of US dollars, as investors fret over the risks of another US recession. If so, it could be bad news for China, the largest US foreign creditor.

Seventy percent of China's foreign reserves are denominated in US dollars, including 1.5 trillion dollars in US Treasuries and another 700 million dollars of other assets. China is facing ever-increasing pressure to maintain the value of these reserves.

But a greater part of concerns comes amid a possible negative impact on China's inflation data.

According to a report by J. P Morgan, financing costs will increase by 100 billion US dollars every year in America. Demands for another round of quantitative easing policy by the Federal Reserve are now on the rise.

At the same time, it is feared that capital flowing out of the stock markets will enter commodity markets. It will drive up prices of bulk materials such as crude oil and iron ore in the long run if the dollar continues to fall. They could become another major obstacle for the Chinese economy.

vivi筆記：

stock markets：股票市場(chǎng)
S & P：標(biāo)準(zhǔn)普爾公司
US credit rating：美國(guó)信用評(píng)級(jí)
US recession：美國(guó)經(jīng)濟(jì)衰退
foreign reserves：外匯儲(chǔ)備
US Treasuries：美國(guó)國(guó)庫(kù)券
Federal Reserve：（美國(guó)）聯(lián)邦儲(chǔ)備系統(tǒng)
commodity markets：商品市場(chǎng)
drive up：抬高
crude oil：原油
iron ore：鐵礦石

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