CHINA’S holdings of US treasury bonds fell to $772 billion in September, a drop of $2.6 billion from a month earlier, marking the third consecutive monthly decline, according to the latest data released by the US Department of the Treasury on Monday.
In September, China remained the second-largest holder of US government debt. However, China’s holding of US government debt has been below the $1-trillion mark since April 2022.
Japan, the largest holder of US government debt, also reduced its US treasury bond holdings by $5.9 billion in September, the data showed.
REDUCTION File photo shows a worker counts Chinese currency renminbi at a bank in Linyi, Shandong province. The US Department of Treasury on Nov. 18, 2024, reported China’s US debt holdings was at $772 billion in September. XINHUA PHOTO
Xi Junyang, a professor at the Shanghai University of Finance and Economics, attributed China’s reducing US government debt holdings partially to the global trend of de-dollarization.
“Many countries have accelerated efforts to diversify their reserves by increasing gold holdings and using local currencies for payment amid rising concerns over holding US dollar assets, as US moves to weaponize the dollar have hurt the credibility of the currency,” Xi told the Global Times on Tuesday.
He said that China may continue to appropriately trim its holdings of US government debt in an orderly fashion to optimize the structure of the country’s foreign exchange reserves.
According to data released by the State Administration of Foreign Exchange on Nov. 7, China’s foreign exchange reserves totaled $3.26 trillion at the end of October, a drop of $55.32 billion, or 1.67 percent, compared to the end of September. The decline was attributed to the recent changes in forex rates on the global market.
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