Bond Default in China May Signal Opportunity for US

A pedestrian walks past the People's Bank of China, also known as China's Central Bank in Beijing, 22 August 2007. China's bid to tighten liquidity while most central banks worldwide are battling to boost cash flows underlines the Asian giant's status as largely immune from the troubles afflicting global markets. AFP PHOTO/TEH ENG KOON Photo credit should read TEH ENG KOON/AFP/Getty Images

A landmark bond default, the first of its kind in China, may indicate that the country’s debt crisis is beginning to bite.

The debt situation in China will bring greater pressure for depreciation of the yuan and will make it more difficult for China to sustain a trade war with the United States, an expert says. This could be an opportunity for the United States to push harder against the Chinese regime to reform its economic structure.