The dollar is an extremely important currency and China is concerned about its value.

The dollar is an extremely important currency and China is concerned about its value, the Chinese central bank governor said on Saturday.

Zhou Xiaochuan, head of the People's Bank of China, roiled markets a year ago when he suggested that a new super-sovereign currency should someday become the world's main reserve currency.

But speaking at a news conference on the sidelines of China's annual parliament, Zhou expressed a much more conservative view about the international currency order, emphasising that a healthy dollar was vital to the workings of the global economy.

"The U.S. dollar is still an extremely important currency, playing a key role in international trade, cross-border capital flows, direct investment as well as in determining whether we can smoothly overcome the global financial crisis smoothly," he said.

China, which has about two-thirds of its $2.4 trillion of foreign exchange reserves invested in dollar-denominated assets, has long said that it hopes the U.S. currency remains strong to shore up the value of its holdings.

But Zhou said China's concerns were broader.

"Asset value is just one perspective for viewing this issue, and of course, we continue to pay attention to this aspect," he said.

"But, in fact, whether the dollar is strong or weak, what kind of monetary policy the Federal Reserve adopts as well as the U.S. government debt situation all have a broader impact on the global economy as well as the Chinese economy."

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