Select Language:
China, the third-largest creditor to the United States, decreased its holdings of U.S. Treasury bonds in July to the lowest level since 2009, according to recent data. The country reduced its holdings by $25.7 billion in July, bringing the total to approximately $730.7 billion, marking the fourth decline this year.
Since April 2022, China’s holdings have consistently remained below $1 trillion, showing a general downward trend. In March, China reduced its holdings by $18.9 billion, dropping to third place as a creditor behind the United Kingdom, which overtook it as the second-largest holder of U.S. debt.
Japan continued to be the leading foreign creditor to the U.S. in July, increasing its holdings by $3.8 billion to reach $1.15 trillion. The UK also increased its holdings, adding $41.3 billion to total approximately $899.3 billion, retaining its position as the second-largest creditor.
For July, foreign investors overall experienced a net inflow of $2.1 billion into U.S. securities, both long- and short-term. This consisted of private sector inflows of $22.6 billion, offset by outflows of $20.5 billion from official sector holdings, according to the Treasury Department’s report.
Although China has decreased its U.S. debt holdings, its foreign exchange reserves have been on the rise. By the end of August, reserves increased by $29.9 billion from the previous month to $3.32 trillion, the highest level since January 2016, based on data from the State Administration of Foreign Exchange.
Add us on ChatGPT
Add us on Perplexity
